ý | Quarterly report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 |
¨ | Transition report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 |
Delaware | 77-0201147 |
(State or other jurisdiction of incorporation or organization) | (I.R.S. Employer Identification Number) |
Large accelerated filer | ¨ | Accelerated filer | ý |
Non-accelerated filer | ¨ (Do not check if a smaller reporting company) | Smaller reporting company | ¨ |
Emerging growth company | ¨ |
September 29, 2017 | December 31, 2016 | ||||||
ASSETS | |||||||
Current assets: | |||||||
Cash and cash equivalents | $ | 50,039 | $ | 55,635 | |||
Short-term investments | — | 6,923 | |||||
Accounts receivable, net | 71,582 | 86,765 | |||||
Inventories | 31,754 | 41,193 | |||||
Prepaid expenses and other current assets | 22,682 | 26,319 | |||||
Total current assets | 176,057 | 216,835 | |||||
Property and equipment, net | 30,731 | 32,164 | |||||
Goodwill | 241,932 | 237,279 | |||||
Intangibles, net | 23,316 | 29,231 | |||||
Other long-term assets | 39,926 | 38,560 | |||||
Total assets | $ | 511,962 | $ | 554,069 | |||
LIABILITIES AND STOCKHOLDERS’ EQUITY | |||||||
Current liabilities: | |||||||
Other debts and capital lease obligations, current | $ | 7,434 | $ | 7,275 | |||
Accounts payable | 31,839 | 28,892 | |||||
Income taxes payable | 1,411 | 1,166 | |||||
Deferred revenue | 52,811 | 52,414 | |||||
Accrued and other current liabilities | 52,828 | 55,150 | |||||
Total current liabilities | 146,323 | 144,897 | |||||
Convertible notes, long-term | 107,318 | 103,259 | |||||
Other debts and capital lease obligations, long-term | 15,439 | 13,915 | |||||
Income taxes payable, long-term | 591 | 2,926 | |||||
Deferred tax liabilities, long-term | 327 | — | |||||
Other non-current liabilities | 21,366 | 18,431 | |||||
Total liabilities | 291,364 | 283,428 | |||||
Commitments and contingencies (Note 18) | |||||||
Stockholders’ equity: | |||||||
Preferred stock, $0.001 par value, 5,000 shares authorized; no shares issued or outstanding | — | — | |||||
Common stock, $0.001 par value, 150,000 shares authorized; 81,606 and 78,456 shares issued and outstanding at September 29, 2017 and December 31, 2016, respectively | 82 | 78 | |||||
Additional paid-in capital | 2,267,213 | 2,254,055 | |||||
Accumulated deficit | (2,045,967 | ) | (1,976,222 | ) | |||
Accumulated other comprehensive loss | (730 | ) | (7,270 | ) | |||
Total stockholders’ equity | 220,598 | 270,641 | |||||
Total liabilities and stockholders’ equity | $ | 511,962 | $ | 554,069 |
Three months ended | Nine months ended | ||||||||||||||
September 29, 2017 | September 30, 2016 | September 29, 2017 | September 30, 2016 | ||||||||||||
Revenue: | |||||||||||||||
Product | $ | 58,161 | $ | 70,285 | $ | 158,657 | $ | 205,342 | |||||||
Services | 33,853 | 31,121 | 98,615 | 87,467 | |||||||||||
Total net revenue | 92,014 | 101,406 | 257,272 | 292,809 | |||||||||||
Cost of revenue: | |||||||||||||||
Product | 27,736 | 34,460 | 85,843 | 105,698 | |||||||||||
Services | 17,253 | 15,583 | 50,181 | 44,054 | |||||||||||
Total cost of revenue | 44,989 | 50,043 | 136,024 | 149,752 | |||||||||||
Total gross profit | 47,025 | 51,363 | 121,248 | 143,057 | |||||||||||
Operating expenses: | |||||||||||||||
Research and development | 21,289 | 24,202 | 73,226 | 74,272 | |||||||||||
Selling, general and administrative | 37,121 | 36,112 | 104,377 | 105,498 | |||||||||||
Amortization of intangibles | 793 | 3,009 | 2,347 | 9,606 | |||||||||||
Restructuring and related charges | 2,028 | (27 | ) | 4,084 | 4,488 | ||||||||||
Total operating expenses | 61,231 | 63,296 | 184,034 | 193,864 | |||||||||||
Loss from operations | (14,206 | ) | (11,933 | ) | (62,786 | ) | (50,807 | ) | |||||||
Interest expense, net | (2,794 | ) | (2,734 | ) | (8,064 | ) | (7,806 | ) | |||||||
Other expense, net | (498 | ) | (328 | ) | (1,828 | ) | (5 | ) | |||||||
Loss on impairment of long-term investment | — | (1,259 | ) | — | (2,735 | ) | |||||||||
Loss before income taxes | (17,498 | ) | (16,254 | ) | (72,678 | ) | (61,353 | ) | |||||||
(Benefit from) provision for income taxes | (1,915 | ) | (242 | ) | (1,568 | ) | 518 | ||||||||
Net loss | $ | (15,583 | ) | $ | (16,012 | ) | $ | (71,110 | ) | $ | (61,871 | ) | |||
Net loss per share: | |||||||||||||||
Basic and diluted | $ | (0.19 | ) | $ | (0.21 | ) | $ | (0.88 | ) | $ | (0.80 | ) | |||
Shares used in per share calculation: | |||||||||||||||
Basic and diluted | 81,445 | 78,092 | 80,618 | 77,475 |
Three months ended | Nine months ended | ||||||||||||||
September 29, 2017 | September 30, 2016 | September 29, 2017 | September 30, 2016 | ||||||||||||
Net loss | $ | (15,583 | ) | $ | (16,012 | ) | $ | (71,110 | ) | $ | (61,871 | ) | |||
Other comprehensive income (loss) before tax: | |||||||||||||||
Change in unrealized gain on cash flow hedges: | |||||||||||||||
Unrealized gain arising during the period | — | 121 | — | 279 | |||||||||||
(Gain) loss reclassified into earnings | — | (47 | ) | — | 53 | ||||||||||
— | 74 | — | 332 | ||||||||||||
Change in unrealized gain (loss) on available-for-sale securities: | |||||||||||||||
Unrealized (loss) gain arising during the period | 8 | (1,208 | ) | (605 | ) | (1,178 | ) | ||||||||
Loss reclassified into earnings | — | 1,259 | — | 2,735 | |||||||||||
8 | 51 | (605 | ) | 1,557 | |||||||||||
Change in foreign currency translation adjustments | 2,265 | 523 | 7,147 | (154 | ) | ||||||||||
Other comprehensive income before tax | 2,273 | 648 | 6,542 | 1,735 | |||||||||||
Less: Provision for (benefit from) income taxes | — | (3 | ) | 2 | 20 | ||||||||||
Other comprehensive income, net of tax | 2,273 | 651 | 6,540 | 1,715 | |||||||||||
Total comprehensive loss | $ | (13,310 | ) | $ | (15,361 | ) | $ | (64,570 | ) | $ | (60,156 | ) |
Nine months ended | |||||||
September 29, 2017 | September 30, 2016 | ||||||
Cash flows from operating activities: | |||||||
Net loss | $ | (71,110 | ) | $ | (61,871 | ) | |
Adjustments to reconcile net loss to net cash used in operating activities: | |||||||
Amortization of intangibles | 6,232 | 12,711 | |||||
Depreciation | 11,045 | 13,198 | |||||
Stock-based compensation | 11,107 | 8,542 | |||||
Amortization of discount on convertible debt and issuance cost | 4,060 | 3,669 | |||||
Restructuring, asset impairment and loss on retirement of fixed assets | 565 | 1,476 | |||||
Amortization of non-cash warrant | 38 | — | |||||
Loss on impairment of long-term investment | — | 2,735 | |||||
Foreign currency adjustments | 1,795 | (911 | ) | ||||
Provision for excess and obsolete inventories | 5,578 | 6,246 | |||||
Allowance for doubtful accounts and returns | 4,309 | 1,222 | |||||
Other non-cash adjustments, net | 298 | 251 | |||||
Changes in operating assets and liabilities, net of effects of acquisition: | |||||||
Accounts receivable | 11,367 | (12,869 | ) | ||||
Inventories | 6,188 | 2,225 | |||||
Prepaid expenses and other assets | 6,702 | (5,938 | ) | ||||
Accounts payable | 2,129 | 2,505 | |||||
Deferred revenue | (1,098 | ) | 20,038 | ||||
Income taxes payable | (2,122 | ) | (827 | ) | |||
Accrued and other liabilities | (3,053 | ) | (5,040 | ) | |||
Net cash used in operating activities | (5,970 | ) | (12,638 | ) | |||
Cash flows from investing activities: | |||||||
Acquisition of business, net of cash acquired | — | (75,669 | ) | ||||
Proceeds from maturities of investments | 3,106 | 18,692 | |||||
Proceeds from sales of investments | 3,792 | — | |||||
Purchases of property and equipment | (9,075 | ) | (11,423 | ) | |||
Net cash used in investing activities | (2,177 | ) | (68,400 | ) | |||
Cash flows from financing activities: | |||||||
Payment of convertible debt issuance costs | — | (582 | ) | ||||
Proceeds from other debts and capital leases | 6,344 | 5,968 | |||||
Repayment of other debts and capital leases | (7,008 | ) | (8,038 | ) | |||
Proceeds from common stock issued to employees | 4,697 | 3,736 | |||||
Payment of tax withholding obligations related to net share settlements of restricted stock units | (2,757 | ) | (1,313 | ) | |||
Net cash provided by (used in) financing activities | 1,276 | (229 | ) | ||||
Effect of exchange rate changes on cash and cash equivalents | 1,275 | (182 | ) | ||||
Net decrease in cash and cash equivalents | (5,596 | ) | (81,449 | ) | |||
Cash and cash equivalents at beginning of period | 55,635 | 126,190 | |||||
Cash and cash equivalents at end of period | $ | 50,039 | $ | 44,741 |
Assets: | |||
Cash and cash equivalents | $ | 6,843 | |
Accounts receivable, net | 14,933 | ||
Inventories | 3,462 | ||
Prepaid expenses and other current assets | 2,412 | ||
Property and equipment, net | 9,942 | ||
French R&D tax credit receivables (1) | 26,421 | ||
Other long-term assets | 2,134 | ||
Total assets | $ | 66,147 | |
Liabilities: | |||
Other debts and capital lease obligations, current | 8,362 | ||
Accounts payable | 12,494 | ||
Deferred revenue | 2,504 | ||
Accrued and other current liabilities | 18,365 | ||
Other debts and capital lease obligations, long-term | 16,087 | ||
Other non-current liabilities | 6,467 | ||
Deferred tax liabilities | 2,126 | ||
Total liabilities | $ | 66,405 | |
Goodwill | 41,670 | ||
Intangibles | 41,100 | ||
Total purchase consideration | $ | 82,512 |
Estimated Useful Life (in years) | Fair Value | ||||
Backlog | 6 months | $ | 3,600 | ||
Developed technology | 4 years | 21,700 | |||
Customer relationships | 5 years | 15,200 | |||
Trade name | 4 years | 600 | |||
$ | 41,100 |
Acquisition-related | Integration-related | |||||||||||||||||||||||
Three months ended | Nine months ended | Three months ended | Nine months ended | |||||||||||||||||||||
September 30, 2016 | September 29, 2017 | September 30, 2016 | September 29, 2017 | September 30, 2016 | ||||||||||||||||||||
Product cost of revenue | $ | — | $ | — | $ | — | $ | 119 | $ | 342 | $ | 610 | ||||||||||||
Research and development | — | — | — | 152 | 7 | 702 | ||||||||||||||||||
Selling, general and administrative | 534 | 3,855 | 117 | 4,365 | 2,385 | 6,502 | ||||||||||||||||||
Total acquisition- and integration-related expenses in operating expenses | 534 | 3,855 | 117 | 4,636 | 2,734 | 7,814 | ||||||||||||||||||
Interest expense, net | — | — | — | 98 | — | 98 | ||||||||||||||||||
Total acquisition- and integration-related expenses | $ | 534 | $ | 3,855 | $ | 117 | $ | 4,734 | $ | 2,734 | $ | 7,912 |
Amortized Cost | Gross Unrealized Gains | Gross Unrealized Losses | Estimated Fair Value | ||||||||||||
As of December 31, 2016 | |||||||||||||||
Corporate bonds | $ | 6,928 | $ | — | $ | (5 | ) | $ | 6,923 | ||||||
Total short-term investments | $ | 6,928 | $ | — | $ | (5 | ) | $ | 6,923 |
Three months ended | Nine months ended | ||||||||||||||||
Financial Statement Location | September 29, 2017 | September 30, 2016 | September 29, 2017 | September 30, 2016 | |||||||||||||
Derivatives designated as hedging instruments: | |||||||||||||||||
Gains in AOCI on derivatives (effective portion) | AOCI | $ | — | $ | 121 | $ | — | $ | 279 | ||||||||
Gains (losses) reclassified from AOCI into income (effective portion) | Cost of Revenue | $ | — | $ | 6 | $ | — | $ | (7 | ) | |||||||
Operating Expense | — | 41 | — | (46 | ) | ||||||||||||
Total | $ | — | $ | 47 | $ | — | $ | (53 | ) | ||||||||
Losses recognized in income on derivatives (ineffectiveness portion and amount excluded from effectiveness testing) | Other expense, net | $ | — | $ | (8 | ) | $ | — | $ | (57 | ) | ||||||
Derivatives not designated as hedging instruments: | |||||||||||||||||
Gains (losses) recognized in income | Other expense, net | $ | 119 | $ | (162 | ) | $ | (66 | ) | $ | (496 | ) |
September 29, 2017 | December 31, 2016 | |||||||
Derivatives not designated as hedging instruments: | ||||||||
Purchase | $ | 12,925 | $ | 4,056 | ||||
Sell | $ | 1,501 | $ | 11,157 |
Asset Derivatives | Derivative Liabilities | |||||||||||||||||||
Balance Sheet Location | September 29, 2017 | December 31, 2016 | Balance Sheet Location | September 29, 2017 | December 31, 2016 | |||||||||||||||
Derivatives not designated as hedging instruments: | ||||||||||||||||||||
Foreign currency contracts | Prepaid expenses and other current assets | $ | 13 | $ | 54 | Accrued Liabilities | $ | 45 | $ | 40 | ||||||||||
Total derivatives | $ | 13 | $ | 54 | $ | 45 | $ | 40 |
Gross Amounts of Derivatives Not Offset in the Condensed Consolidated Balance Sheets | ||||||||||||||||||||||
Gross Amounts of Derivatives | Gross Amounts of Derivatives Offset in the Condensed Consolidated Balance Sheets | Net Amounts of Derivatives Presented in the Condensed Consolidated Balance Sheets | Financial Instrument | Cash Collateral Pledged | Net Amount | |||||||||||||||||
Derivative Assets | $ | 13 | — | $ | 13 | $ | (6 | ) | — | $ | 7 | |||||||||||
Derivative Liabilities | $ | 45 | — | $ | 45 | $ | (6 | ) | — | $ | 39 |
• | Level 1 — Observable inputs that reflect quoted prices for identical assets or liabilities in active markets. |
• | Level 2 — Observable inputs other than Level 1 prices, such as quoted prices for similar assets or liabilities, quoted prices in markets that are not active, or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities. The Company primarily uses broker quotes for valuation of its short-term investments. The forward exchange contracts are classified as Level 2 because they are valued using quoted market prices and other observable data for similar instruments in an active market. |
• | Level 3 — Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities. |
Level 1 | Level 2 | Level 3 | Total | ||||||||||||
As of September 29, 2017 | |||||||||||||||
Cash equivalents | |||||||||||||||
Money market funds | $ | 246 | $ | — | $ | — | $ | 246 | |||||||
Prepaids and other current assets | |||||||||||||||
Derivative assets | — | 13 | — | 13 | |||||||||||
Other assets | |||||||||||||||
Long-term investment | 200 | — | — | 200 | |||||||||||
Total assets measured and recorded at fair value | $ | 446 | $ | 13 | $ | — | $ | 459 | |||||||
Accrued and other current liabilities | |||||||||||||||
Derivative liabilities | $ | — | $ | 45 | $ | — | $ | 45 | |||||||
Accrued TVN VDP, current portion | — | — | 3,519 | 3,519 | |||||||||||
Other non-current liabilities | |||||||||||||||
Accrued TVN VDP, long-term portion | — | — | 2,485 | 2,485 | |||||||||||
Total liabilities measured and recorded at fair value | $ | — | $ | 45 | $ | 6,004 | $ | 6,049 | |||||||
Level 1 | Level 2 | Level 3 | Total | ||||||||||||
As of December 31, 2016 | |||||||||||||||
Cash equivalents | |||||||||||||||
Money market funds | $ | 8,301 | $ | — | $ | — | $ | 8,301 | |||||||
Corporate bonds | — | 6,923 | — | 6,923 | |||||||||||
Prepaids and other current assets | |||||||||||||||
Derivative assets | — | 54 | — | 54 | |||||||||||
Other assets | |||||||||||||||
Long-term investment | 809 | — | — | 809 | |||||||||||
Total assets measured and recorded at fair value | $ | 9,110 | $ | 6,977 | $ | — | $ | 16,087 | |||||||
Accrued and other current liabilities | |||||||||||||||
Derivative liabilities | $ | — | $ | 40 | $ | — | $ | 40 | |||||||
Accrued TVN VDP, current portion | — | — | 6,597 | 6,597 | |||||||||||
Other non-current liabilities | |||||||||||||||
Accrued TVN VDP, long-term portion | — | — | 3,053 | 3,053 | |||||||||||
Total liabilities measured and recorded at fair value | $ | — | $ | 40 | $ | 9,650 | $ | 9,690 |
September 29, 2017 | December 31, 2016 | ||||||
Accounts receivable, net: | |||||||
Accounts receivable | $ | 77,320 | $ | 91,596 | |||
Less: allowances for doubtful accounts, returns and discounts | (5,738 | ) | (4,831 | ) | |||
Total | $ | 71,582 | $ | 86,765 |
September 29, 2017 | December 31, 2016 | ||||||
Prepaid expenses and other current assets: | |||||||
Deferred cost of revenue | $ | 6,217 | $ | 6,856 | |||
French R&D tax credits receivable(1) | 6,475 | 5,895 | |||||
Prepaid maintenance, royalty, rent, property taxes and value added tax | 4,942 | 5,526 | |||||
Prepaid customer incentive(2) | 1,124 | 1,162 | |||||
Restricted cash(3) | 803 | 731 | |||||
Other | 3,121 | 6,149 | |||||
Total | $ | 22,682 | $ | 26,319 |
September 29, 2017 | December 31, 2016 | ||||||
Inventories: | |||||||
Raw materials | $ | 3,825 | $ | 9,889 | |||
Work-in-process | 1,290 | 2,318 | |||||
Finished goods | 14,146 | 17,776 | |||||
Service-related spares | 12,493 | 11,210 | |||||
Total | $ | 31,754 | $ | 41,193 |
September 29, 2017 | December 31, 2016 | ||||||
Property and equipment, net: | |||||||
Machinery and equipment | $ | 86,971 | $ | 97,989 | |||
Capitalized software | 34,496 | 34,519 | |||||
Leasehold improvements | 14,745 | 14,455 | |||||
Furniture and fixtures | 6,797 | 8,993 | |||||
Property and equipment, gross | 143,009 | 155,956 | |||||
Less: accumulated depreciation and amortization | (112,278 | ) | (123,792 | ) | |||
Total | $ | 30,731 | $ | 32,164 |
September 29, 2017 | December 31, 2016 | ||||||
Accrued and other current liabilities: | |||||||
Accrued employee compensation and related expenses | $ | 14,866 | $ | 19,377 | |||
Accrued TVN VDP, current (1) | 3,519 | 6,597 | |||||
Accrued warranty | 4,341 | 4,862 | |||||
Customer deposits | 4,526 | 4,537 | |||||
Contingent inventory reserves | 3,840 | 2,210 | |||||
Accrued Avid litigation settlement, current (2) | 2,500 | — | |||||
Accrued royalty payments | 2,325 | 1,912 | |||||
Others | 16,911 | 15,655 | |||||
Total | $ | 52,828 | $ | 55,150 |
Video | Cable Edge | Total | |||||||||
Balance as of December 31, 2016 | $ | 176,519 | $ | 60,760 | $ | 237,279 | |||||
Foreign currency translation adjustment | 4,603 | 50 | 4,653 | ||||||||
Balance as of September 29, 2017 | $ | 181,122 | $ | 60,810 | $ | 241,932 |
September 29, 2017 | December 31, 2016 | ||||||||||||||||||||||||
Weighted Average Remaining Life (Years) | Gross Carrying Amount | Accumulated Amortization | Net Carrying Amount | Gross Carrying Amount | Accumulated Amortization | Net Carrying Amount | |||||||||||||||||||
Developed core technology | 2.4 | $ | 31,707 | $ | (19,101 | ) | $ | 12,606 | $ | 31,707 | $ | (15,216 | ) | $ | 16,491 | ||||||||||
Customer relationships/contracts | 3.4 | 44,748 | (34,425 | ) | 10,323 | 44,384 | (32,098 | ) | 12,286 | ||||||||||||||||
Trademarks and trade names | 2.4 | 641 | (254 | ) | 387 | 573 | (119 | ) | 454 | ||||||||||||||||
Maintenance agreements and related relationships | N/A | 5,500 | (5,500 | ) | — | 5,500 | (5,500 | ) | — | ||||||||||||||||
Order Backlog | N/A | 3,011 | (3,011 | ) | — | 3,011 | (3,011 | ) | — | ||||||||||||||||
Total identifiable intangibles | $ | 85,607 | $ | (62,291 | ) | $ | 23,316 | $ | 85,175 | $ | (55,944 | ) | $ | 29,231 |
Three months ended | Nine months ended | ||||||||||||||
September 29, 2017 | September 30, 2016 | September 29, 2017 | September 30, 2016 | ||||||||||||
Included in cost of revenue | $ | 1,295 | $ | 1,380 | $ | 3,885 | $ | 3,105 | |||||||
Included in operating expenses | 793 | 3,009 | 2,347 | 9,606 | |||||||||||
Total amortization expense | $ | 2,088 | $ | 4,389 | $ | 6,232 | $ | 12,711 |
Cost of Revenue | Operating Expenses | Total | |||||||||
Year ended December 31, | |||||||||||
2017 (remaining three months) | $ | 1,296 | $ | 794 | $ | 2,090 | |||||
2018 | 5,180 | 3,182 | 8,362 | ||||||||
2019 | 5,180 | 3,182 | 8,362 | ||||||||
2020 | 950 | 3,048 | 3,998 | ||||||||
2021 | — | 504 | 504 | ||||||||
Total future amortization expense | $ | 12,606 | $ | 10,710 | $ | 23,316 |
Three months ended | Nine months ended | ||||||||||||||
September 29, 2017 | September 30, 2016 | September 29, 2017 | September 30, 2016 | ||||||||||||
Restructuring and related charges in: | |||||||||||||||
Product cost of revenue | $ | 549 | $ | (1 | ) | $ | 1,335 | $ | (24 | ) | |||||
Operating expenses-Restructuring and related charges | 2,028 | (27 | ) | 4,084 | 4,488 | ||||||||||
Total restructuring and related charges | $ | 2,577 | $ | (28 | ) | $ | 5,419 | $ | 4,464 |
Years ending December 31, | |||
2017 (remaining three months) | $ | 1,145 | |
2018 | 2,937 | ||
2019 | 1,379 | ||
2020 | 543 | ||
Total | $ | 6,004 |
Excess facilities | VDP (1) | Severance and benefits (2) | Total | ||||||||||||
Balance at December 31, 2016 | $ | 2,375 | $ | 9,650 | $ | 1,519 | $ | 13,544 | |||||||
Charges for 2016 Harmonic Restructuring Plan | 73 | 1,781 | 1,137 | 2,991 | |||||||||||
Adjustments to restructuring provisions | — | — | (7 | ) | (7 | ) | |||||||||
Cash payments | (921 | ) | (6,232 | ) | (2,512 | ) | (9,665 | ) | |||||||
Foreign exchange gain | — | 805 | 36 | 841 | |||||||||||
Balance at September 29, 2017 | 1,527 | 6,004 | 173 | 7,704 | |||||||||||
Less: current portion (3) | (730 | ) | (3,519 | ) | (173 | ) | (4,422 | ) | |||||||
Long-term portion (3) | $ | 797 | $ | 2,485 | $ | — | $ | 3,282 |
Excess facilities | Non-VDP Severance and benefits | Total | |||||||||
Charges for 2017 Restructuring Plan | 318 | 2,117 | 2,435 | ||||||||
Cash payments | (45 | ) | (1,593 | ) | (1,638 | ) | |||||
Non-cash write-offs | 58 | — | 58 | ||||||||
Balance at September 29, 2017 | 331 | 524 | 855 | ||||||||
Less: current portion (1) | (160 | ) | (524 | ) | (684 | ) | |||||
Long-term portion (2) | $ | 171 | $ | — | $ | 171 |
September 29, 2017 | December 31, 2016 | ||||||
Liability: | |||||||
Principal amount | $ | 128,250 | $ | 128,250 | |||
Less: Debt discount, net of amortization | (18,680 | ) | (22,302 | ) | |||
Less: Debt issuance costs, net of amortization | (2,252 | ) | (2,689 | ) | |||
Carrying amount | $ | 107,318 | $ | 103,259 | |||
Remaining amortization period (years) | 3.2 | 3.9 | |||||
Effective interest rate on liability component | 9.94 | % | 9.94 | % | |||
Equity: | |||||||
Value of conversion option | $ | 26,925 | $ | 26,925 | |||
Less: Equity issuance costs | (863 | ) | (863 | ) | |||
Carrying amount | $ | 26,062 | $ | 26,062 |
Three months ended | Nine months ended | ||||||||||||||
September 29, 2017 | September 30, 2016 | September 29, 2017 | September 30, 2016 | ||||||||||||
Contractual interest expense | $ | 1,283 | $ | 1,283 | $ | 3,848 | $ | 3,848 | |||||||
Amortization of debt discount | 1,235 | 1,117 | 3,623 | 3,274 | |||||||||||
Amortization of debt issuance costs | 149 | 135 | 437 | 395 | |||||||||||
Total interest expense recognized | $ | 2,667 | $ | 2,535 | $ | 7,908 | $ | 7,517 |
September 29, 2017 | December 31, 2016 | ||||||
Financing from French government agencies related to various government incentive programs (1) | $ | 20,205 | $ | 17,930 | |||
Term loans (2) | 1,334 | 1,400 | |||||
Obligations under capital leases | 1,334 | 1,860 | |||||
Total debt obligations | 22,873 | 21,190 | |||||
Less: current portion | (7,434 | ) | (7,275 | ) | |||
Long-term portion | $ | 15,439 | $ | 13,915 |
Years ending December 31, | Capital lease obligations | Other Debt obligations | |||||
2017 (remaining three months) | $ | 305 | $ | 616 | |||
2018 | 864 | 6,058 | |||||
2019 | 93 | 6,995 | |||||
2020 | 50 | 6,800 | |||||
2021 | 22 | 505 | |||||
Thereafter | — | 565 | |||||
Total | $ | 1,334 | $ | 21,539 |
Stock Options Outstanding | RSUs Outstanding** | |||||||||||||||
Shares Available for Grant | Number of Shares | Weighted Average Exercise Price | Number of Units | Weighted Average Grant Date Fair Value | ||||||||||||
Balance at December 31, 2016 | 3,912 | 5,019 | $ | 6.01 | 3,864 | $ | 4.26 | |||||||||
Authorized | 7,400 | — | — | — | — | |||||||||||
Granted* | (4,446 | ) | 30 | 5.10 | 2,943 | 5.40 | ||||||||||
Options exercised | — | (97 | ) | 3.03 | — | — | ||||||||||
Shares released | — | — | — | (2,244 | ) | 4.12 | ||||||||||
Forfeited* | 2,490 | (717 | ) | 5.95 | (1,182 | ) | 5.05 | |||||||||
Balance at September 29, 2017 | 9,356 | 4,235 | $ | 6.09 | 3,381 | $ | 5.04 |
Number of Shares | Weighted Average Exercise Price | Weighted Average Remaining Contractual Term (Years) | Aggregate Intrinsic Value | |||||||||
Vested and expected to vest | 4,176 | $ | 6.10 | 3.1 | $ | 84 | ||||||
Exercisable | 3,505 | 6.31 | 2.7 | 84 |
Number of Shares Underlying Restricted Stock Units | Weighted Average Remaining Vesting Period (Years) | Aggregate Fair Value | ||||||
Vested and expected to vest | 2,759 | 0.8 | $ | 8,415 |
Three months ended | Nine months ended | ||||||||||||||
September 29, 2017 | September 30, 2016 | September 29, 2017 | September 30, 2016 | ||||||||||||
Service cost | $ | 55 | $ | 70 | $ | 165 | $ | 164 | |||||||
Interest cost | 16 | 29 | 48 | 68 | |||||||||||
Recognized net actuarial loss | 1 | — | 4 | — | |||||||||||
Net periodic benefit cost included in operating loss | $ | 72 | $ | 99 | $ | 217 | $ | 232 |
Three months ended | Nine months ended | ||||||||||||||
September 29, 2017 | September 30, 2016 | September 29, 2017 | September 30, 2016 | ||||||||||||
Stock-based compensation in: | |||||||||||||||
Cost of revenue | $ | 478 | $ | 360 | $ | 1,623 | $ | 1,011 | |||||||
Research and development expense | 1,183 | 771 | 3,496 | 2,581 | |||||||||||
Selling, general and administrative expense | 2,059 | 1,549 | 5,988 | 4,950 | |||||||||||
Total stock-based compensation in operating expense | 3,242 | 2,320 | 9,484 | 7,531 | |||||||||||
Total stock-based compensation | $ | 3,720 | $ | 2,680 | $ | 11,107 | $ | 8,542 |
Employee Stock Options | ||||||||
Three months ended | Nine months ended | |||||||
September 30, 2016 | September 29, 2017 | September 30, 2016 | ||||||
Expected term (years) | 4.30 | 4.60 | 4.30 | |||||
Volatility | 39 | % | 43 | % | 36 | % | ||
Risk-free interest rate | 1.0 | % | 1.7 | % | 1.4 | % | ||
Expected dividends | 0.0 | % | 0.0 | % | 0.0 | % |
ESPP Purchase Period Ending | |||||||||||
December 31, 2017 | June 30, 2017 | December 31, 2016 | July 1, 2016 | ||||||||
Expected term (years) | 0.50 | 0.49 | 0.50 | 0.5 | |||||||
Volatility | 43 | % | 41 | % | 70 | % | 54 | % | |||
Risk-free interest rate | 1.2 | % | 1.0 | % | 0.6 | % | 0.4 | % | |||
Expected dividends | 0.0 | % | 0.0 | % | 0.0 | % | 0.0 | % | |||
Estimated weighted average fair value per share at purchase date | $1.42 | $1.40 | $1.04 | $1.19 |
Three months ended | Nine months ended | ||||||||||||||
September 29, 2017 | September 30, 2016 | September 29, 2017 | September 30, 2016 | ||||||||||||
Loss before income taxes | $ | (17,498 | ) | $ | (16,254 | ) | $ | (72,678 | ) | $ | (61,353 | ) | |||
(Benefit from) provision for income taxes | (1,915 | ) | (242 | ) | (1,568 | ) | 518 | ||||||||
Effective income tax rate | 10.9 | % | 1.5 | % | 2.2 | % | (0.8 | )% |
Three months ended | Nine months ended | ||||||||||||||
September 29, 2017 | September 30, 2016 | September 29, 2017 | September 30, 2016 | ||||||||||||
Numerator: | |||||||||||||||
Net loss | $ | (15,583 | ) | $ | (16,012 | ) | $ | (71,110 | ) | $ | (61,871 | ) | |||
Denominator: | |||||||||||||||
Weighted average number of common shares outstanding | |||||||||||||||
Basic and diluted | 81,445 | 78,092 | 80,618 | 77,475 | |||||||||||
Net loss per share: | |||||||||||||||
Basic and diluted | $ | (0.19 | ) | $ | (0.21 | ) | $ | (0.88 | ) | $ | (0.80 | ) |
Three months ended | Nine months ended | ||||||||||
September 29, 2017 | September 30, 2016 | September 29, 2017 | September 30, 2016 | ||||||||
Stock options | 4,377 | 5,193 | 4,628 | 5,389 | |||||||
RSUs | 3,213 | 2,800 | 3,107 | 2,273 | |||||||
Stock purchase rights under the ESPP | 1,118 | 1,212 | 630 | 641 | |||||||
Warrants (1) | 782 | 43 | 782 | 14 | |||||||
Total | 9,490 | 9,248 | 9,147 | 8,317 |
Foreign Currency Translation Adjustments | Unrealized Gains (Losses) on Available-for-Sale Investments | Actuarial Loss | Total | ||||||||||||
Balance as of December 31, 2016 | $ | (7,267 | ) | $ | 276 | $ | (279 | ) | $ | (7,270 | ) | ||||
Other comprehensive income (loss) before reclassifications | 7,147 | (605 | ) | — | 6,542 | ||||||||||
Provision for income taxes | — | (2 | ) | — | (2 | ) | |||||||||
Balance as of September 29, 2017 | $ | (120 | ) | $ | (331 | ) | $ | (279 | ) | $ | (730 | ) |
Three months ended | Nine months ended | ||||||||||||||
September 29, 2017 | September 30, 2016 | September 29, 2017 | September 30, 2016 | ||||||||||||
Gains (losses) on cash flow hedges from foreign currency contracts: | |||||||||||||||
Cost of revenue | $ | — | $ | 6 | $ | — | $ | (7 | ) | ||||||
Operating expenses | — | 41 | — | (46 | ) | ||||||||||
Total reclassifications from AOCI | $ | — | $ | 47 | $ | — | $ | (53 | ) |
Three months ended | Nine months ended | ||||||||||||||
September 29, 2017 | September 30, 2016 | September 29, 2017 | September 30, 2016 | ||||||||||||
Net revenue: | |||||||||||||||
Video | $ | 84,155 | $ | 91,353 | $ | 231,876 | $ | 246,949 | |||||||
Cable Edge | 7,859 | 10,053 | 25,396 | 45,860 | |||||||||||
Total consolidated net revenue | $ | 92,014 | $ | 101,406 | $ | 257,272 | $ | 292,809 | |||||||
Operating income (loss): | |||||||||||||||
Video | $ | 7,009 | $ | 4,886 | $ | (7,774 | ) | $ | (1,943 | ) | |||||
Cable Edge | (5,357 | ) | (4,767 | ) | (18,848 | ) | (7,118 | ) | |||||||
Total segment operating (loss) income | 1,652 | 119 | (26,622 | ) | (9,061 | ) | |||||||||
Unallocated corporate expenses | (10,050 | ) | (4,983 | ) | (18,825 | ) | (20,493 | ) | |||||||
Stock-based compensation | (3,720 | ) | (2,680 | ) | (11,107 | ) | (8,542 | ) | |||||||
Amortization of intangibles | (2,088 | ) | (4,389 | ) | (6,232 | ) | (12,711 | ) | |||||||
Loss from operations | (14,206 | ) | (11,933 | ) | (62,786 | ) | (50,807 | ) | |||||||
Non-operating expense, net | (3,292 | ) | (4,321 | ) | (9,892 | ) | (10,546 | ) | |||||||
Loss before income taxes | $ | (17,498 | ) | $ | (16,254 | ) | $ | (72,678 | ) | $ | (61,353 | ) |
Years ending December 31, | |||
2017 (remaining three months) | $ | 3,359 | |
2018 | 13,053 | ||
2019 | 11,607 | ||
2020 | 8,218 | ||
2021 | 2,738 | ||
Thereafter | 11,169 | ||
Total | $ | 50,144 |
Three months ended | Nine months ended | ||||||||||||||
September 29, 2017 | September 30, 2016 | September 29, 2017 | September 30, 2016 | ||||||||||||
Balance at beginning of period | $ | 4,142 | $ | 5,095 | $ | 4,862 | $ | 3,913 | |||||||
Balance assumed from TVN acquisition | — | — | — | 1,012 | |||||||||||
Accrual for current period warranties | 1,354 | 1,552 | 3,849 | 4,527 | |||||||||||
Changes in liability related to pre-existing warranties | — | (99 | ) | — | (173 | ) | |||||||||
Warranty costs incurred | (1,155 | ) | (1,469 | ) | (4,370 | ) | (4,200 | ) | |||||||
Balance at end of period | $ | 4,341 | $ | 5,079 | $ | 4,341 | $ | 5,079 |
• | developing trends and demands in the markets we address, particularly emerging markets; |
• | economic conditions, particularly in certain geographies, and in financial markets; |
• | new and future products and services; |
• | capital spending of our customers; |
• | our strategic direction, future business plans and growth strategy; |
• | industry and customer consolidation; |
• | expected demand for and benefits of our products and services; |
• | seasonality of revenue and concentration of revenue sources; |
• | expectations regarding the impact of our TVN acquisition; |
• | expectations regarding our CableOS solutions; |
• | expectations regarding the impact of the Warrant issued to Comcast on our business; |
• | potential future acquisitions and dispositions; |
• | anticipated results of potential or actual litigation; |
• | our competitive environment; |
• | the impact of our restructuring plans; |
• | the impact of governmental regulation; |
• | anticipated revenue and expenses, including the sources of such revenue and expenses; |
• | expected impacts of changes in accounting rules; |
• | expectations regarding the usability of our inventory and the risk that inventory will exceed forecasted demand; |
• | expectations and estimates related to goodwill and intangible assets and their associated carrying value; |
• | use of cash, cash needs and ability to raise capital; and |
• | the condition of our cash investments. |
Three months ended | Nine months ended | ||||||||||||||||||||||||||
September 29, 2017 | September 30, 2016 | Q3 FY17 vs Q3 FY16 | September 29, 2017 | September 30, 2016 | Q3 FY17 YTD vs Q3 FY16 YTD | ||||||||||||||||||||||
Segment: | |||||||||||||||||||||||||||
Video | $ | 84,155 | $ | 91,353 | $ | (7,198 | ) | (8 | )% | $ | 231,876 | $ | 246,949 | $ | (15,073 | ) | (6 | )% | |||||||||
Cable Edge | 7,859 | 10,053 | (2,194 | ) | (22 | )% | 25,396 | 45,860 | (20,464 | ) | (45 | )% | |||||||||||||||
Total net revenue | $ | 92,014 | $ | 101,406 | $ | (9,392 | ) | (9 | )% | $ | 257,272 | $ | 292,809 | $ | (35,537 | ) | (12 | )% | |||||||||
Segment revenue as a % of total net revenue: | |||||||||||||||||||||||||||
Video | 91 | % | 90 | % | 90 | % | 84 | % | |||||||||||||||||||
Cable Edge | 9 | % | 10 | % | 10 | % | 16 | % |
Three months ended | Nine months ended | ||||||||||||||||||||||||||
September 29, 2017 | September 30, 2016 | Q3 FY17 vs Q3 FY16 | September 29, 2017 | September 30, 2016 | Q3 FY17 YTD vs Q3 FY16 YTD | ||||||||||||||||||||||
Geography: | |||||||||||||||||||||||||||
Americas | $ | 48,656 | $ | 47,856 | $ | 800 | 2 | % | $ | 127,173 | $ | 154,513 | $ | (27,340 | ) | (18 | )% | ||||||||||
EMEA | 27,528 | 32,405 | (4,877 | ) | (15 | )% | 77,920 | 85,716 | (7,796 | ) | (9 | )% | |||||||||||||||
APAC | 15,830 | 21,145 | (5,315 | ) | (25 | )% | 52,179 | 52,580 | (401 | ) | (1 | )% | |||||||||||||||
Total net revenue | $ | 92,014 | $ | 101,406 | $ | (9,392 | ) | (9 | )% | $ | 257,272 | $ | 292,809 | $ | (35,537 | ) | (12 | )% | |||||||||
Regional revenue as a % of total net revenue: | |||||||||||||||||||||||||||
Americas | 53 | % | 47 | % | 49 | % | 53 | % | |||||||||||||||||||
EMEA | 30 | % | 32 | % | 30 | % | 29 | % | |||||||||||||||||||
APAC | 17 | % | 21 | % | 21 | % | 18 | % |
Three months ended | Nine months ended | ||||||||||||||||||||||||||
September 29, 2017 | September 30, 2016 | Q3 FY17 vs Q3 FY16 | September 29, 2017 | September 30, 2016 | Q3 FY17 YTD vs Q3 FY16 YTD | ||||||||||||||||||||||
Gross profit | $ | 47,025 | $ | 51,363 | $ | (4,338 | ) | (8 | )% | $ | 121,248 | $ | 143,057 | $ | (21,809 | ) | (15 | )% | |||||||||
As a percentage of net revenue (“gross margin”) | 51.1 | % | 50.7 | % | 0.4 | % | 47.1 | % | 48.9 | % | (1.8 | )% |
Three months ended | Nine months ended | ||||||||||||||||||||||||||
September 29, 2017 | September 30, 2016 | Q3 FY17 vs Q3 FY16 | September 29, 2017 | September 30, 2016 | Q3 FY17 YTD vs Q3 FY16 YTD | ||||||||||||||||||||||
Research and development | $ | 21,289 | $ | 24,202 | $ | (2,913 | ) | (12 | )% | $ | 73,226 | $ | 74,272 | $ | (1,046 | ) | (1 | )% | |||||||||
As a percentage of net revenue | 23.1 | % | 23.9 | % | 28.5 | % | 25.4 | % |
Three months ended | Nine months ended | ||||||||||||||||||||||||||
September 29, 2017 | September 30, 2016 | Q3 FY17 vs Q3 FY16 | September 29, 2017 | September 30, 2016 | Q3 FY17 YTD vs Q3 FY16 YTD | ||||||||||||||||||||||
Selling, general and administrative | $ | 37,121 | $ | 36,112 | $ | 1,009 | 3 | % | $ | 104,377 | $ | 105,498 | $ | (1,121 | ) | (1 | )% | ||||||||||
As a percentage of net revenue | 40.3 | % | 35.6 | % | 40.6 | % | 36.0 | % |
Three months ended | Nine months ended | ||||||||||||||||||||||||||
September 29, 2017 | September 30, 2016 | Q3 FY17 vs Q3 FY16 | September 29, 2017 | September 30, 2016 | Q3 FY17 YTD vs Q3 FY16 YTD | ||||||||||||||||||||||
Video | $ | 7,009 | $ | 4,886 | $ | 2,123 | 43 | % | $ | (7,774 | ) | $ | (1,943 | ) | $ | (5,831 | ) | 300 | % | ||||||||
Cable Edge | (5,357 | ) | (4,767 | ) | (590 | ) | 12 | % | (18,848 | ) | (7,118 | ) | (11,730 | ) | 165 | % | |||||||||||
Total segment operating income (loss) | $ | 1,652 | $ | 119 | $ | 1,533 | 1,288 | % | $ | (26,622 | ) | $ | (9,061 | ) | $ | (17,561 | ) | 194 | % | ||||||||
Segment operating income (loss) as a % of segment revenue (“operating margin”): | |||||||||||||||||||||||||||
Video | 8.3 | % | 5.3 | % | 3.0 | % | (3.4 | )% | (0.8 | )% | (2.6 | )% | |||||||||||||||
Cable Edge | (68.2 | )% | (47.4 | )% | (20.8 | )% | (74.2 | )% | (15.5 | )% | (58.7 | )% |
Three months ended | Nine months ended | ||||||||||||||
September 29, 2017 | September 30, 2016 | September 29, 2017 | September 30, 2016 | ||||||||||||
Total segment operating income (income) | $ | 1,652 | $ | 119 | $ | (26,622 | ) | $ | (9,061 | ) | |||||
Unallocated corporate expenses | (10,050 | ) | (4,983 | ) | (18,825 | ) | (20,493 | ) | |||||||
Stock-based compensation | (3,720 | ) | (2,680 | ) | (11,107 | ) | (8,542 | ) | |||||||
Amortization of intangibles | (2,088 | ) | (4,389 | ) | (6,232 | ) | (12,711 | ) | |||||||
Loss from operations | (14,206 | ) | (11,933 | ) | (62,786 | ) | (50,807 | ) | |||||||
Non-operating expense, net | (3,292 | ) | (4,321 | ) | (9,892 | ) | (10,546 | ) | |||||||
Loss before income taxes | $ | (17,498 | ) | $ | (16,254 | ) | $ | (72,678 | ) | $ | (61,353 | ) |
Three months ended | Nine months ended | ||||||||||||||||||||||||||
September 29, 2017 | September 30, 2016 | Q3 FY17 vs Q3 FY16 | September 29, 2017 | September 30, 2016 | Q3 FY17 YTD vs Q3 FY16 YTD | ||||||||||||||||||||||
Amortization of intangibles | $ | 793 | $ | 3,009 | $ | (2,216 | ) | (74 | )% | $ | 2,347 | $ | 9,606 | $ | (7,259 | ) | (76 | )% | |||||||||
As a percentage of net revenue | 0.9 | % | 3.0 | % | 0.9 | % | 3.3 | % |
Three months ended | Nine months ended | ||||||||||||||
September 29, 2017 | September 30, 2016 | September 29, 2017 | September 30, 2016 | ||||||||||||
Restructuring and related charges in: | |||||||||||||||
Product cost of revenue | $ | 549 | $ | (1 | ) | $ | 1,335 | $ | (24 | ) | |||||
Operating expenses-Restructuring and related charges | 2,028 | (27 | ) | 4,084 | 4,488 | ||||||||||
Total restructuring and related charges | $ | 2,577 | $ | (28 | ) | $ | 5,419 | $ | 4,464 |
Years ending December 31, | |||
2017 (remaining three months) | $ | 1,145 | |
2018 | 2,937 | ||
2019 | 1,379 | ||
2020 | 543 | ||
Total | $ | 6,004 |
Three months ended | Nine months ended | ||||||||||||||||||||||||||
September 29, 2017 | September 30, 2016 | Q3 FY17 vs Q3 FY16 | September 29, 2017 | September 30, 2016 | Q3 FY17 YTD vs Q3 FY16 YTD | ||||||||||||||||||||||
(Benefit from) provision for income taxes | $ | (1,915 | ) | $ | (242 | ) | $ | (1,673 | ) | 691 | % | $ | (1,568 | ) | $ | 518 | $ | (2,086 | ) | (403 | )% | ||||||
Effective income tax rate | 10.9 | % | 1.5 | % | 2.2 | % | (0.8 | )% |
Nine months ended | |||||||
September 29, 2017 | September 30, 2016 | ||||||
Net cash provided by (used in): | |||||||
Operating activities | $ | (5,970 | ) | $ | (12,638 | ) | |
Investing activities | (2,177 | ) | (68,400 | ) | |||
Financing activities | 1,276 | (229 | ) | ||||
Effect of foreign exchange rate changes on cash | 1,275 | (182 | ) | ||||
Net decrease in cash and cash equivalents | $ | (5,596 | ) | $ | (81,449 | ) |
Payments due by period | |||||||||||||||||||
Total Amounts Committed | Less than 1 year | 1 to 3 years | 4 to 5 years | More than 5 years | |||||||||||||||
Convertible debt | $ | 128,250 | $ | — | $ | — | $ | 128,250 | $ | — | |||||||||
Interest on convertible debt | 17,955 | 5,130 | 10,260 | 2,565 | — | ||||||||||||||
Other debts | 21,539 | 6,474 | 13,870 | 1,025 | 170 | ||||||||||||||
Capital Lease | 1,334 | 960 | 351 | 23 | — | ||||||||||||||
Operating leases | 50,144 | 13,666 | 21,328 | 7,281 | 7,869 | ||||||||||||||
Purchase commitments | 27,764 | 21,325 | 4,202 | 1,239 | 998 | ||||||||||||||
Avid litigation settlement fees | 6,000 | 2,500 | 3,500 | — | — | ||||||||||||||
Total contractual obligations | $ | 252,986 | $ | 50,055 | $ | 53,511 | $ | 140,383 | $ | 9,037 | |||||||||
Other commercial commitments: | |||||||||||||||||||
Standby letters of credit | $ | 845 | $ | 305 | $ | 540 | $ | — | $ | — | |||||||||
Total commercial commitments | $ | 845 | $ | 305 | $ | 540 | $ | — | $ | — |
September 29, 2017 | December 31, 2016 | ||||||
Derivatives not designated as hedging instruments: | |||||||
Purchase | $ | 12,925 | $ | 4,056 | |||
Sell | $ | 1,501 | $ | 11,157 |
Exhibit Number | Exhibit Index |
10.1** | |
10.2** | |
10.3(i) | |
31.1 | |
31.2 | |
32.1* | |
32.2* | |
101 | The following materials from Registrant’s Quarterly Report on Form 10-Q for the quarter ended September 29, 2017, formatted in Extensible Business Reporting Language (XBRL) include: |
(i) Condensed Consolidated Balance Sheets at September 29, 2017 and December 31, 2016, (ii) Condensed Consolidated Statements of Operations for the three and nine months ended September 29, 2017 and September 30, 2016 (iii) Condensed Consolidated Statements of Comprehensive Loss for the three and nine months ended September 29, 2017 and September 30, 2016, (iv) Condensed Consolidated Statements of Cash Flows for the three and nine months ended September 29, 2017 and September 30 2016, and (v) Notes to Condensed Consolidated Financial Statements. |
HARMONIC INC. | |
By: | /s/ Sanjay Kalra |
Sanjay Kalra | |
Chief Financial Officer | |
Date: November 6, 2017 |
COMPANY: | HARMONIC INC. |
By: | |
Title: | |
Date: | |
EMPLOYEE: | Patrick Harshman |
(signature) | |
Date: | |
COMPANY: | HARMONIC INC. |
By: | |
Title: | |
Date: | |
Employee: | |
(print name) | |
(signature) | |
Date: | |
1. | I have reviewed this Quarterly Report on Form 10-Q of Harmonic Inc.; |
2. | Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; |
3. | Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report; |
4. | The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant, and have: |
a) | Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; |
b) | Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; |
c) | Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report, based on such evaluation; and |
d) | Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and |
5. | The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions): |
a) | All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and |
b) | Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting. |
By: | /s/ Patrick J. Harshman |
Patrick J. Harshman | |
President and Chief Executive Officer |
1. | I have reviewed this Quarterly Report on Form 10-Q of Harmonic Inc.; |
2. | Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; |
3. | Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report; |
4. | The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant, and have: |
a) | Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; |
b) | Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; |
c) | Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report, based on such evaluation; and |
d) | Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and |
5. | The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions): |
a) | All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and |
b) | Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting. |
By: | /s/ Sanjay Kalra |
Sanjay Kalra | |
Chief Financial Officer |
/s/ Patrick J. Harshman |
Patrick J. Harshman |
President and Chief Executive Officer |
/s/ Sanjay Kalra |
Sanjay Kalra |
Chief Financial Officer |
Document and Entity Information - shares |
9 Months Ended | |
---|---|---|
Sep. 29, 2017 |
Oct. 30, 2017 |
|
Document And Entity Information [Abstract] | ||
Document Type | 10-Q | |
Amendment Flag | false | |
Document Period End Date | Sep. 29, 2017 | |
Document Fiscal Year Focus | 2017 | |
Document Fiscal Period Focus | Q3 | |
Trading Symbol | HLIT | |
Entity Registrant Name | HARMONIC INC | |
Entity Central Index Key | 0000851310 | |
Current Fiscal Year End Date | --12-31 | |
Entity Filer Category | Accelerated Filer | |
Entity Common Stock, Shares Outstanding | 81,618,569 |
CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares |
Sep. 29, 2017 |
Dec. 31, 2016 |
---|---|---|
Statement of Financial Position [Abstract] | ||
Preferred stock, par value | $ 0.001 | $ 0.001 |
Preferred stock, shares authorized | 5,000,000 | 5,000,000 |
Preferred stock, shares issued | 0 | 0 |
Preferred stock, shares outstanding | 0 | 0 |
Common stock, par value | $ 0.001 | $ 0.001 |
Common stock, shares authorized | 150,000,000 | 150,000,000 |
Common stock, shares issued | 81,606,000 | 78,456,000 |
Common stock, shares outstanding | 81,606,000 | 78,456,000 |
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) shares in Thousands, $ in Thousands |
3 Months Ended | 9 Months Ended | ||
---|---|---|---|---|
Sep. 29, 2017 |
Sep. 30, 2016 |
Sep. 29, 2017 |
Sep. 30, 2016 |
|
Income Statement [Abstract] | ||||
Product | $ 58,161 | $ 70,285 | $ 158,657 | $ 205,342 |
Services | 33,853 | 31,121 | 98,615 | 87,467 |
Total net revenue | 92,014 | 101,406 | 257,272 | 292,809 |
Product | 27,736 | 34,460 | 85,843 | 105,698 |
Services | 17,253 | 15,583 | 50,181 | 44,054 |
Total cost of revenue | 44,989 | 50,043 | 136,024 | 149,752 |
Total gross profit | 47,025 | 51,363 | 121,248 | 143,057 |
Operating expenses: | ||||
Research and development | 21,289 | 24,202 | 73,226 | 74,272 |
Selling, general and administrative | 37,121 | 36,112 | 104,377 | 105,498 |
Amortization of intangibles | 793 | 3,009 | 2,347 | 9,606 |
Restructuring and related charges | 2,028 | (27) | 4,084 | 4,488 |
Total operating expenses | 61,231 | 63,296 | 184,034 | 193,864 |
Loss from operations | (14,206) | (11,933) | (62,786) | (50,807) |
Interest expense, net | (2,794) | (2,734) | (8,064) | (7,806) |
Other expense, net | (498) | (328) | (1,828) | (5) |
Loss on impairment of long-term investment | 0 | (1,259) | 0 | (2,735) |
Loss before income taxes | (17,498) | (16,254) | (72,678) | (61,353) |
(Benefit from) provision for income taxes | (1,915) | (242) | (1,568) | 518 |
Net loss | $ (15,583) | $ (16,012) | $ (71,110) | $ (61,871) |
Net loss per share: | ||||
Basic and diluted | $ (0.19) | $ (0.21) | $ (0.88) | $ (0.80) |
Shares used in per share calculation: | ||||
Basic and diluted | 81,445 | 78,092 | 80,618 | 77,475 |
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) - USD ($) $ in Thousands |
3 Months Ended | 9 Months Ended | ||
---|---|---|---|---|
Sep. 29, 2017 |
Sep. 30, 2016 |
Sep. 29, 2017 |
Sep. 30, 2016 |
|
Net loss | $ (15,583) | $ (16,012) | $ (71,110) | $ (61,871) |
Other comprehensive income (loss) before tax: | ||||
Unrealized gain arising during the period | 0 | 121 | 0 | 279 |
(Gain) loss reclassified into earnings | 0 | (47) | 0 | 53 |
Change in unrealized gain on cash flow hedges: | 0 | 74 | 0 | 332 |
Unrealized (loss) gain arising during the period | 8 | (1,208) | (605) | (1,178) |
Loss reclassified into earnings | 0 | 1,259 | 0 | 2,735 |
Change in unrealized gain (loss) on available-for-sale securities: | 8 | 51 | (605) | 1,557 |
Change in foreign currency translation adjustments | 2,265 | 523 | 7,147 | (154) |
Other comprehensive income before tax | 2,273 | 648 | 6,542 | 1,735 |
Less: Provision for (benefit from) income taxes | 0 | (3) | 2 | 20 |
Other comprehensive income, net of tax | 2,273 | 651 | 6,540 | 1,715 |
Total comprehensive loss | $ (13,310) | $ (15,361) | $ (64,570) | $ (60,156) |
Basis of Presentation and Significant Accounting Policies |
9 Months Ended |
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Sep. 29, 2017 | |
Accounting Policies [Abstract] | |
Basis of Presentation and Significant Accounting Policies | BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES Basis of Presentation The accompanying unaudited condensed consolidated financial statements, in the opinion of management, include all adjustments (consisting only of normal recurring adjustments) which Harmonic Inc. (“Harmonic,” or the “Company”) considers necessary for a fair statement of the results of operations for the interim periods covered and the consolidated financial condition of the Company at the date of the balance sheets. This Quarterly Report on Form 10-Q should be read in conjunction with the Company’s audited consolidated financial statements contained in the Company’s Annual Report on Form 10-K, which was filed with the Securities and Exchange Commission on March 3, 2017 (the “2016 Form 10-K”). The interim results presented herein are not necessarily indicative of the results of operations that may be expected for the full fiscal year ending December 31, 2017, or any other future period. The Company’s fiscal quarters are based on 13-week periods, except for the fourth quarter, which ends on December 31. The condensed consolidated financial statements include the accounts of the Company and its subsidiaries. All significant intercompany accounts and transactions have been eliminated in consolidation. The year-end condensed balance sheet was derived from audited financial statements, but does not include all disclosures required by accounting principles generally accepted in the United States of America (“U.S. GAAP”). On February 29, 2016, the Company completed the acquisition of Thomson Video Networks (“TVN”). TVN is now a part of the Company’s Video segment and its results of operations are included in the Company’s Condensed Consolidated Statements of Operations beginning March 1, 2016. During the fourth quarter of 2016, the Company completed the accounting for this business combination. Use of Estimates The preparation of the condensed consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting period. Actual results could differ from those estimates. Significant Accounting Policies The Company’s significant accounting policies are described in Note 2 to its audited Consolidated Financial Statements included in the 2016 Form 10-K. There have been no significant changes to these policies during the nine months ended September 29, 2017 other than those disclosed in Note 2, “Standards Implemented”. |
Recent Accounting Pronouncements |
9 Months Ended |
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Sep. 29, 2017 | |
Accounting Changes and Error Corrections [Abstract] | |
Recent Accounting Pronouncements | RECENT ACCOUNTING PRONOUNCEMENTS New standards to be implemented In May 2014, the Financial Accounting Standards Board (“FASB”) issued a new standard, Accounting Standards Update (“ASU”) No. 2014-09, Revenue from Contracts with Customers, as amended, which will supersede nearly all existing revenue recognition guidance. Under ASU 2014-09, an entity is required to recognize revenue upon transfer of promised goods or services to customers in an amount that reflects the expected consideration received in exchange for those goods or services. ASU No. 2014-09 defines a five-step process in order to achieve this core principle, which may require the use of judgment and estimates, and also requires expanded qualitative and quantitative disclosures relating to the nature, amount, timing and uncertainty of revenue and cash flows arising from contracts with customers, including significant judgments and estimates used. The FASB has issued several amendments to the new standard, including clarification on accounting for licenses of intellectual property and identifying performance obligations. The amendments include ASU No. 2016-08, Revenue from Contracts with Customers (Topic 606)-Principal versus Agent Considerations, which was issued in March 2016, and clarifies the implementation guidance for principal versus agent considerations in ASU 2014-09, and ASU No. 2016-10, Revenue from Contracts with Customers (Topic 606)-Identifying Performance Obligations and Licensing, which was issued in April 2016, and amends the guidance in ASU No. 2014-09 related to identifying performance obligations and accounting for licenses of intellectual property. The new standard permits adoption either by using (i) a full retrospective approach for all periods presented in the period of adoption or (ii) a modified retrospective approach with the cumulative effect of initially applying the new standard recognized at the date of initial application and providing certain additional disclosures. The new standard is effective for annual reporting periods beginning after December 15, 2017, with early adoption permitted for annual reporting periods beginning after December 15, 2016. The Company will adopt the new standard effective January 1, 2018. The Company currently plans to adopt using the modified retrospective approach. However, a decision regarding the adoption method has not been finalized at this time. The Company’s final determination will depend on a number of factors, such as the significance of the impact of the new standard on its financial results, system readiness, including that of software procured from third-party providers, and its ability to accumulate and analyze the information necessary to assess the impact on prior period financial statements, as necessary. The Company is currently evaluating the impact of the new standard on its accounting policies, processes, and system requirements. The Company has made and will continue to make investments in systems to enable timely and accurate reporting under the new standard. While the Company continues to assess all potential impacts under the new standard, there is the potential for significant impacts to the timing of recognition of software licenses with undelivered features and professional services revenue related to service contracts with acceptance terms as well as contract acquisition costs, both with respect to the amounts that will be capitalized as well as the period of amortization. Under current industry-specific software revenue recognition guidance, the Company has historically concluded that it did not have vendor-specific objective evidence (“VSOE”) of fair value of the undelivered features relating to delivered software licenses, and accordingly, it has deferred entire revenue for such software licenses until the delivery of features. Professional services included in arrangements with acceptances have also been recognized on receipt of acceptance. The new standard, which does not retain the concept of VSOE, requires an evaluation of whether the undelivered features are distinct performance obligations and, therefore, should be separately recognized when delivered compared to the timing of delivery of software license. Professional services will generally be recorded as services are provided. Depending on the outcome of the Company’s evaluation, the timing of when revenue is recognized could change for future features and professional services under the new standard. As part of the Company’s preliminary evaluation, it has also considered the impact of the guidance in ASC 340-40, Other Assets and Deferred Costs; Contracts with Customers, and the interpretations of the FASB Transition Resource Group for Revenue Recognition (“TRG”) from their November 7, 2016 meeting with respect to capitalization and amortization of incremental costs of obtaining a contract. As a result of this new guidance, the Company is currently assessing if it will need to capitalize any costs of obtaining the contract, including additional sales commissions. Under the Company’s current accounting policy, it expenses the commission costs immediately as incurred. While the Company continues to assess the potential impacts of the new standard, including the areas described above, the Company does not know or cannot yet reasonably estimate quantitative information related to the impact of the new standard on its financial statements at this time. In January 2016, the FASB issued an accounting standard update which requires equity investments to be measured at fair value with changes in fair value recognized in net income and simplifies the impairment assessment of equity investments without readily determinable fair values by requiring a qualitative assessment to identify impairment. The accounting standard update also updates certain presentation and disclosure requirements. This accounting standard update will be effective for the Company beginning in the first quarter of fiscal 2018 and early adoption is permitted. The adoption of this new standard is not expected to have a material impact on the Company’s consolidated financial statements. In February 2016, the FASB amended the existing accounting standard for lease accounting. Under this guidance, lessees and lessors should apply a “right-of-use” model in accounting for all leases (including subleases) and eliminate the concept of operating leases and off-balance sheet leases. This new leases standard requires a modified retrospective transition approach for all leases existing at, or entered into after, the date of initial application, with an option to use certain transition relief. The new standard will be effective for the Company beginning in the first quarter of fiscal 2019 and early adoption is permitted. The Company is currently evaluating the methods and impact of adopting this new leases standard on its consolidated financial statements. In June 2016, the FASB issued new guidance that changes the impairment model for most financial assets and certain other instruments. For trade receivables and other instruments, the Company will be required to use a new forward-looking “expected loss” model. Additionally, credit losses on available-for-sale debt securities should be recorded through an allowance for credit losses limited to the amount by which fair value is below amortized cost. The new guidance will be effective for the Company beginning in the first quarter of fiscal 2019 and early adoption is permitted. The Company is currently evaluating the impact of adopting this new accounting guidance on its consolidated financial statements. In August 2016, the FASB issued an accounting standard update that addresses eight specific cash flow issues with the objective of reducing the existing diversity in practice. This accounting standard update will be effective for the Company beginning in the first quarter of fiscal 2018 on a retrospective basis, and early adoption is permitted. The adoption of this new standard is not expected to have a material impact on the Company’s consolidated financial statements. In November 2016, the FASB issued an accounting standard update which requires companies to include restricted cash and restricted cash equivalents in its cash and cash equivalent balances in the statement of cash flows. Transfers between cash, cash equivalents, restricted cash, and restricted cash equivalents are no longer presented in the statement of cash flows. The new guidance requires a reconciliation of the totals in the statement of cash flows to the related captions. This accounting standard update will be effective for the Company beginning in the first quarter of fiscal 2018 on a retrospective basis, and early adoption is permitted. The adoption of this new guidance is not expected to have a material impact on the Company’s consolidated financial statements. In January 2017, the FASB issued an accounting standard update to simplify the test for goodwill impairment. It removes Step 2 of the goodwill impairment test and requires the assessment of fair value of individual assets and liabilities of a reporting unit to measure goodwill impairments. Goodwill impairment will now be the amount by which a reporting unit's carrying value exceeds its fair value. The accounting standard update will be effective for the Company beginning in the first quarter of fiscal 2020 on a prospective basis, and early adoption is permitted. The Company is currently evaluating the impact of adopting this new accounting guidance on its consolidated financial statements. In January 2017, the FASB issued an accounting standard update to clarify the definition of a business with the objective of adding guidance to assist entities with evaluating whether transactions should be accounted for as acquisitions (or disposals) of assets or businesses. The definition of a business affects many areas of accounting including acquisitions, disposals, goodwill, and consolidation. The guidance will be effective for the Company beginning in the first quarter of fiscal 2018 on a prospective basis, and early adoption is permitted. The adoption of this new guidance is not expected to have a material impact on the Company’s consolidated financial statements. In March 2017, the FASB issued a new accounting standard to improve the presentation of net periodic pension cost and net periodic post-retirement benefit cost. This new standard will be effective for the Company beginning in the first quarter of fiscal 2018 on a retrospective basis and early adoption is permitted. The adoption of this new guidance is not expected to have a material impact on the Company’s consolidated financial statements. In May 2017, the FASB issued a new accounting standard to clarify when to account for a change to the terms or conditions for a share-based payment award as a modification. It requires modification accounting only if the fair value, the vesting condition or the classification of the award changes as a result of the change in terms or conditions. This new standard will be effective for the Company beginning in the first quarter of fiscal 2018 on a prospective basis and early adoption is permitted. The adoption of this new standard is not expected to have a material impact on the Company’s consolidated financial statements. Standards Implemented In February 2015, the FASB issued an accounting standard update that changes the analysis that a reporting entity must perform to determine whether it should consolidate certain types of legal entities. The accounting standard update became effective for the Company beginning in the first quarter of fiscal 2017. The application of this accounting standard update did not have any impact on the Company's Consolidated Balance Sheet or Statement of Operations upon adoption. In July 2015, the FASB issued an accounting standard update that requires inventory to be measured at the lower of cost and net realizable value. Net realizable value is the estimated selling prices in the ordinary course of business, less reasonably predictable costs of completion, disposal, and transportation. The Company adopted this accounting standard update beginning in the first quarter of fiscal 2017 and the adoption did not have a material impact on its consolidated financial statements. In March 2016, the FASB issued an accounting standard update to clarify the requirements for assessing whether contingent call (put) options that can accelerate the payment of principal on debt instruments are clearly and closely related to their debt hosts. An entity performing the assessment under the amendments is required to assess the embedded call (put) options solely in accordance with the four-step decision sequence. The Company adopted this accounting standard update beginning in the first quarter of fiscal 2017 and the adoption did not have any impact on its consolidated financial statements. In March 2016, the FASB issued an accounting standard update for the accounting of share-based payment transactions, including the income tax consequences, classification of awards as either equity or liabilities and classification on the statement of cash flows. The new standard eliminated the requirement to report excess tax benefits and certain tax deficiencies related to share-based payment transactions as additional paid-in capital. It also removes the requirement to delay recognition of a windfall tax benefit until it reduces current taxes payable. Under the new guidance, the benefit will be recorded when it arises, subject to normal valuation allowance considerations. The Company adopted this new accounting standard beginning in the first quarter of fiscal 2017 using a modified-retrospective transition method and recorded a cumulative effect of $4.6 million of additional gross deferred tax asset associated with shared-based payment and an offsetting valuation allowance of the same amount, therefore resulting in no net impact to the Company’s beginning retained earnings. Prior to January 1, 2017, stock-based compensation expense was recorded net of estimated forfeitures in the Company’s condensed consolidated statements of operations and, accordingly, was recorded for only those stock-based awards that the Company expected to vest. Upon the adoption of this accounting standard update, effective January 1, 2017, the Company changed its accounting policy to account for forfeitures as they occur. The change was applied on a modified retrospective approach with a cumulative effect adjustment of $69,000 to retained earnings as of January 1, 2017 (which increased the accumulated deficit). The implementation of this accounting standard update has no impact to the Company’s condensed statement of cash flows because the Company does not have any excess tax benefits from share-based compensation because its tax provision is primarily under full valuation allowance. No prior periods were recast as a result of this change in accounting policy. In October 2016, the FASB issued an accounting standard update which requires companies to recognize the income tax consequences of all intra-entity sales of assets other than inventory when they occur. As a result, a reporting entity would recognize the tax expense from the sale of the asset in the seller’s tax jurisdiction when the transfer occurs, even though the pre-tax effects of that transaction are eliminated in consolidation. Any deferred tax asset that arises in the buyer’s jurisdiction would also be recognized at the time of the transfer. The Company early adopted this accounting standard update during the first quarter of fiscal 2017 on a modified retrospective approach and recorded a cumulative-effect adjustment of $1.4 million to the retained earnings as of January 1, 2017 (which reduced the accumulated deficit). Correspondingly, in the first quarter of fiscal 2017, the Company recognized an additional $1.1 million of net deferred tax assets, after netting with $2.1 million of valuation allowance, and write off the remaining $0.3 million of unamortized tax expenses deferred under the previous guidance to provision for income taxes in the first quarter of fiscal 2017. |
Business Acquisition |
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Business Acquisition, Pro Forma Information [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Business Acquisition | BUSINESS ACQUISITION On February 29, 2016, the Company, through its wholly-owned subsidiary Harmonic International AG, completed its acquisition of 100% of the share capital and voting rights of TVN, a global leader in advanced video compression solutions headquartered in Rennes, France, for a final purchase price of $82.5 million in cash. The Company believes that its acquisition of TVN has strengthened, and will continue to strengthen, the Company’s competitive position in the video infrastructure market as well as to enhance the depth and scale of the Company’s research and development and service and support capabilities in the video arena. During the fourth quarter of 2016, the Company completed the accounting for this business combination. The final TVN purchase price has been allocated to tangible and intangible assets acquired and liabilities assumed on the basis of their respective estimated fair values on the acquisition date. The Company’s allocation of TVN purchase consideration is as follows (in thousands):
(1) See Note 8, “Balance Sheet Components-Prepaid expenses and other current assets” for more information on French R&D tax credit receivables. The following table presents details of the intangible assets acquired through this business combination (in thousands, except years):
The goodwill is not expected to be deductible for income tax purposes but the intangibles assets acquired are expected to be deductible for income tax purposes in certain jurisdictions. Both goodwill and intangibles assets acquired are assigned to the Company’s video reporting unit. Acquisition- and integration- related expenses As a result of the TVN acquisition, the Company incurred the acquisition- and integration- related expenses summarized in the table below (in thousands):
These costs consisted of acquisition-related costs which include outside legal, accounting and other professional services as well as integration-related costs which include incremental costs resulting from the TVN acquisition that are not expected to generate future benefits once the integration is fully consummated. These costs are expensed as incurred. The Company expects to continue to have some TVN integration-related costs throughout the remainder of 2017, primarily outside legal and advisory fees relating to re-organization of TVN’s legal entities. |
Short-Term Investments |
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Cash and Cash Equivalents [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Short-Term Investments | SHORT-TERM INVESTMENTS As of September 29, 2017, the Company has no short-term investments. The following table summarizes the Company’s short-term investments as of December 31, 2016 (in thousands):
The Company’s short-term investments as of December 31, 2016 had maturities of less than one year. These available-for-sale investments are presented as “Current Assets” in the Condensed Consolidated Balance Sheets as they were available for current operations. Realized gains and losses from the sale of investments were not material for the three and nine months ended September 29, 2017 and September 30, 2016. |
Investments in Other Equity Securities |
9 Months Ended |
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Sep. 29, 2017 | |
Investments, All Other Investments [Abstract] | |
Investments in Equity Securities | INVESTMENTS IN OTHER EQUITY SECURITIES From time to time, the Company may acquire certain equity investments for the promotion of business objectives and these investments are classified as long-term investments and included in “Other long-term assets” in the Condensed Consolidated Balance Sheet. In 2014, the Company acquired a 3.3% interest in Vislink plc (“Vislink”), a U.K. public company listed on the AIM exchange in London, for $3.3 million. The investment in Vislink is being accounted for as a cost method investment as the Company does not have significant influence over the operational and financial policies of Vislink. Since the Vislink investment is also an available-for-sale security, its value is marked to market for the difference in fair value at period end. The carrying value of Vislink was $0.2 million and $0.8 million at September 29, 2017 and December 31, 2016, respectively. Vislink’s accumulated unrealized (loss) gain, net of taxes was $(0.3) million and $0.3 million at September 29, 2017 and December 31, 2016, respectively. Beginning in late 2015 and continuing through 2016, Vislink’s stock price was below the Company’s cost basis for a prolonged period of time and based on the Company’s assessment, impairment charges of $1.5 million and $1.2 million for Vislink were recorded in the first and third quarter of 2016, respectively, reflecting the new reduced cost basis of the Vislink investment at September 30, 2016. As of December 31, 2016, Vislink’s stock price increased approximately 67% from the stock price as of September 30, 2016. On February 3, 2017, Vislink (from thereon, referred to as Pebble Beach Systems) completed their disposal of its hardware division and changed its name to Pebble Beach Systems. On February 6, 2017, Pebble Beach Systems announced its financial results for fiscal 2016 which showed a significant increase in operating losses. As of September 29, 2017, Pebble Beach Systems’ stock price had declined approximately 82% from the stock price as of December 31, 2016 and Pebble Beach Systems is currently seeking alternatives to maximize value for its shareholders, which could include a sale of the company. In view of Pebble Beach Systems’ potential sale opportunity, the Company determined that the decline in the fair value of Pebble Beach Systems’ investment is not considered permanent yet, and as a result, the cumulative $0.6 million loss in Pebble Beach Systems’ investment in the nine months ended September 29, 2017 was recorded to other comprehensive loss. The Company’s remaining maximum exposure to loss from the Pebble Beach Systems’ investment at September 29, 2017 was approximately $0.5 million, consisting of the carrying value of $0.2 million and the accumulated unrealized loss of $(0.3) million. The assessment as to the nature of a decline in fair value is based on, among other things, the length of time and the extent to which the market value has been less than the Company’s cost basis; the financial condition and near-term prospects of the investment; and the Company’s intent and ability to retain the investment for a period of time sufficient to allow for any anticipated recovery in market value. Unconsolidated Variable Interest Entities (“VIE”) In 2014, the Company acquired an 18.4% interest in Encoding.com, Inc. (“EDC”), a video transcoding service company headquartered in San Francisco, California, for $3.5 million by purchasing EDC’s Series B preferred stock. EDC is considered a variable interest entity but the Company determined that it is not the primary beneficiary of EDC. As a result, EDC is accounted for as a cost method investment. The Company determined that there were no indicators existing at September 29, 2017 that would indicate that the EDC investment was impaired. The Company’s maximum exposure to loss from the EDC’s investment at September 29, 2017 was limited to its investment cost of $3.6 million, including $0.1 million of transaction costs. The Company’s total investments in equity securities of other privately and publicly held companies, as discussed above, were $3.8 million and $4.4 million as of September 29, 2017 and December 31, 2016, respectively, and such investments were considered as long-term investments and were included in “Other long-term assets” in the Condensed Consolidated Balance Sheet. |
Derivative and Hedgiing Activities Derivative and Hedging Activities |
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Derivative Instruments and Hedging Activities Disclosure [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Derivative Instruments and Hedging Activities Disclosure | DERIVATIVES AND HEDGING ACTIVITIES The Company uses forward contracts to manage exposures to foreign currency exchange rates. The Company’s primary objective in holding derivative instruments is to reduce the volatility of earnings and cash flows associated with fluctuations in foreign currency exchange rates and the Company does not use derivative instruments for trading purposes. The use of derivative instruments expose the Company to credit risk to the extent that the counterparties may be unable to meet their contractual obligations, as such, the potential risk of loss with any one counterparty is closely monitored by the Company. Derivatives Not Designated as Hedging Instruments (Balance Sheet Hedges) The Company’s balance sheet hedges consist of foreign currency forward contracts, mature generally within three months, are carried at fair value and are used to minimize the short-term impact of foreign currency exchange rate fluctuation on cash and certain trade and inter-company receivables and payables. Changes in the fair value of these foreign currency forward contracts are recognized in “Other expense, net” in the Condensed Consolidated Statement of Operations and are largely offset by the changes in the fair value of the assets or liabilities being hedged. The locations and amounts of designated and non-designated derivative instruments’ gains and losses reported in the Company’s Accumulated Other Comprehensive Loss (“AOCI”) and Condensed Consolidated Statements of Operations were as follows (in thousands):
The U.S. dollar equivalents of all outstanding notional amounts of foreign currency forward contracts, including the Euro, British pound, Israeli shekels, Japanese yen and Mexican peso, are summarized as follows (in thousands):
The locations and fair value amounts of the Company’s derivative instruments reported in its Condensed Consolidated Balance Sheets are as follows (in thousands):
Offsetting of Derivative Assets and Liabilities The Company recognizes all derivative instruments on a gross basis in the Condensed Consolidated Balance Sheets. However, the arrangements with its counterparties allows for net settlement, which are designed to reduce credit risk by permitting net settlement with the same counterparty. As of September 29, 2017, information related to the offsetting arrangements was as follows (in thousands):
In connection with foreign currency derivatives entered in Israel, the Company’s subsidiaries in Israel are required to maintain a compensating balance with their bank at the end of each month. The compensating balance arrangements do not legally restrict the use of cash and as of September 29, 2017, the total compensating balance maintained was $2.5 million. |
Fair Value Measurements |
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Fair Value Disclosures [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Fair Value Measurements | FAIR VALUE MEASUREMENTS The applicable accounting guidance establishes a framework for measuring fair value and requires disclosure about the fair value measurements of assets and liabilities. This guidance requires the Company to classify and disclose assets and liabilities measured at fair value on a recurring basis, as well as fair value measurements of assets and liabilities measured on a nonrecurring basis in periods subsequent to initial measurement, in a three-tier fair value hierarchy as described below. The guidance defines fair value as the exchange price that would be received for an asset or paid to transfer a liability, in the principal or most advantageous market for the asset or liability, in an orderly transaction between market participants on the measurement date. Valuation techniques used to measure fair value must maximize the use of observable inputs and minimize the use of unobservable inputs. The guidance describes three levels of inputs that may be used to measure fair value:
The carrying value of the Company’s financial instruments, including cash equivalents, restricted cash, accounts receivable, accounts payable and accrued and other current liabilities, approximate fair value due to their short maturities. The Company uses the market approach to measure fair value for its financial assets and liabilities. The market approach uses prices and other relevant information generated by market transactions involving identical or comparable assets or liabilities. The fair value of the Company’s convertible notes is influenced by interest rates, the Company’s stock price and stock market volatility. The estimated fair value of the Company’s convertible notes based on a market approach was approximately $114.2 million and $143.5 million as of September 29, 2017 and December 31, 2016, respectively, and represents a Level 2 valuation. The Company’s other debts and capital leases assumed from the TVN acquisition are classified within Level 2 because these borrowings are not actively traded and the majority of them have a variable interest rate structure based upon market rates currently available to the Company for debt with similar terms and maturities. Additionally, the Company considers the carrying amount of its capital lease obligations to approximate their fair value because the weighted average interest rate used to formulate the carrying amounts approximates current market rates. The other debts and capital leases outstanding as of September 29, 2017 were $22.9 million in the aggregate. (See Note 11, “Convertible Notes, Other debts and Capital Leases” for additional information). The fair value of the Company’s liability for the TVN voluntary departure plan (“TVN VDP”) as of September 29, 2017 of $6.0 million is classified within Level 3 because discount rates which are unobservable in the market were being used to measure the fair value of this liability. (See Note 10, “Restructuring and related Charges-TVN VDP” for additional information). The fair value of the TVN defined pension benefit plan liability of $5.1 million as of September 29, 2017 is disclosed in Note 12, “Employee Benefit Plans and Stock-based Compensation-TVN Retirement Benefit Plan.” During the nine months ended September 29, 2017, there were no nonrecurring fair value measurements of assets and liabilities subsequent to initial recognition. The following table sets forth the fair value of the Company’s financial assets and liabilities measured at fair value on a recurring basis based on the three-tier fair value hierarchy (in thousands):
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Balance Sheet Components |
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Organization, Consolidation and Presentation of Financial Statements [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Balance Sheet Components | BALANCE SHEET COMPONENTS The following tables provide details of selected balance sheet components (in thousands):
(1) The Company’s acquired TVN subsidiary in France (the “TVN French Subsidiary”) participates in the French Crédit d’Impôt Recherche (“CIR”) program (the “R&D tax credits”) which allows companies to monetize eligible research expenses. The R&D tax credits can be used to offset against income tax payable to the French government in each of the four years after being incurred, or if not utilized, are recoverable in cash. The amount of R&D tax credits recoverable are subject to audit by the French government. The R&D tax credit receivables at September 29, 2017 were approximately $26.5 million and are expected to be recoverable from 2018 through 2021 with $6.5 million reported under “Prepaid and other Current Assets” and $20.0 million reported under “Other Long-term Assets” on the Company’s Condensed Consolidated Balance Sheets. (2) On September 26, 2016, the Company issued a warrant to purchase shares of its common stock (the “Warrant”) to Comcast pursuant to which Comcast may, subject to certain vesting provisions, purchase up to 7,816,162 shares of the Company’s common stock subject to adjustment in accordance with the terms of the Warrant, for a per share exercise price of $4.76. The portion of the Warrant which vested on September 26, 2016 had a value of approximately $1.6 million and is deemed a customer incentive paid upfront and cumulatively, $0.5 million of this prepaid incentive has been recorded as a reduction to the Company’s net revenues from Comcast. The remaining $1.1 million of this prepaid incentive is reported as an asset under “Prepaid expenses and other current assets” on the Company’s Condensed Consolidated Balance Sheet as of September 29, 2017. The Company considers this asset to be recoverable based on the expectation of Comcast’s future purchases of the pertinent products. (3) The restricted cash balances are held as cash collateral security for certain bank guarantees. These restricted funds are invested in bank deposits and cannot be withdrawn from the Company’s accounts without the prior written consent of the applicable secured party. Additionally, as of September 29, 2017, the Company had approximately $1.2 million of restricted cash for the bank guarantee associated with the TVN French Subsidiary’s office building lease. This amount is reported under “Other Long-term Assets” on the Company’s Condensed Consolidated Balance Sheets.
(1) See Note 10, “Restructuring and related charges-TVN VDP,” for additional information on the Company’s TVN VDP liabilities. (2) See Note 18, “Commitments and Contingencies-Legal Proceedings,” for additional information on the Company’s accrual for the Avid litigation settlement. |
Goodwill and Identified Intangible Assets |
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Goodwill and Intangible Assets Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Goodwill and Identified Intangible Assets | GOODWILL AND IDENTIFIED INTANGIBLE ASSETS Goodwill Goodwill represents the difference between the purchase price and the estimated fair value of the identifiable assets acquired and liabilities assumed. Goodwill is allocated among and evaluated for impairment at the reporting unit level, which is defined as an operating segment or one level below an operating segment. The Company has two reporting units, Video and Cable Edge. The Company tests for goodwill impairment at the reporting unit level on an annual basis, or more frequently, if events or changes in circumstances indicate that the asset is more likely than not impaired. The Company’s annual goodwill impairment test is performed in the fiscal fourth quarter, with a testing date at the end of October. During 2016, the Company recorded goodwill of $41.7 million for the TVN acquisition. Goodwill from the TVN acquisition is assigned to the Video reporting unit. The changes in the carrying amount of goodwill by reportable segments for the nine months ended September 29, 2017 were as follows (in thousands):
Application of the goodwill impairment test requires judgment, including the identification of reporting units, assigning assets and liabilities to reporting units, assigning goodwill to reporting units, and determining the fair value of each reporting unit. Significant judgments required to estimate the fair value of reporting units include estimating future cash flows and determining appropriate discount rates, growth rates, an appropriate control premium and other assumptions. Changes in these estimates and assumptions could materially affect the determination of fair value for each reporting unit which could trigger impairment. If the Company’s assumptions and related estimates change in the future, or if the Company’s reporting structure changes or other events and circumstances change (e.g. such as a sustained decrease in the Company’s stock price), the Company may be required to record impairment charges in future periods. Any impairment charges that the Company may take in the future could be material to its results of operations and financial condition. The Company performed its annual goodwill impairment review at October 31, 2016. Based on the impairment test performed, management concluded that goodwill was not impaired as the Video and Cable Edge reporting units had estimated fair values in excess of their carrying value by approximately 67% and 123%, respectively. The Company has not recorded any impairment charges related to goodwill for any prior periods. Intangible Assets The following is a summary of intangible assets (in thousands):
Amortization expense for the identifiable purchased intangible assets for the three and nine months ended September 29, 2017 and September 30, 2016 was allocated as follows (in thousands):
The estimated future amortization expense of purchased intangible assets with definite lives is as follows (in thousands):
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Restructuring and Related Charges |
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Restructuring and Related Activities [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Restructuring and Related Charges | RESTRUCTURING AND RELATED CHARGES The Company implemented several restructuring plans in the past few years. The goal of these plans was to bring operational expenses to appropriate levels relative to its net revenues, while simultaneously implementing extensive company-wide expense control programs. The Company accounts for its restructuring plans under the authoritative guidance for exit or disposal activities. The restructuring and related charges are included in “Product cost of revenue” and “Operating expenses-restructuring and related charges” in the Condensed Consolidated Statements of Operations. The following table summarizes the restructuring and related charges (in thousands):
Harmonic 2016 Restructuring In the first quarter of 2016, the Company implemented a new restructuring plan (the “Harmonic 2016 Restructuring Plan”) to streamline the corporate organization, thereby reducing operating costs by consolidating duplicative resources in connection with the acquisition of TVN. The planned activities have primarily resulted, and will primarily result, in cash expenditures related to severance and related benefits and exiting certain operating facilities and disposing of excess assets. In the second quarter of 2016, the Company also initiated the TVN VDP in France to streamline the organization of the TVN French Subsidiary. In 2016, the Company recorded an aggregate of $20.0 million of restructuring and related charges under the Harmonic 2016 Restructuring Plan, of which $2.2 million was primarily related to the Company exiting from an excess facility at its U.S. headquarters and the remaining $17.8 million was related to severance and benefits for the termination of 118 employees worldwide, including 83 employees in France who participated in the TVN VDP. (See details of TVN VDP described below). Additionally, the restructuring and related charges under the Harmonic 2016 Restructuring Plan in 2016 were partially offset by approximately $2.0 million of gain from TVN pension curtailment. For the employees who participated in the TVN VDP, their pension benefit is funded by the TVN VDP and, as a result, the TVN defined benefit pension plan was remeasured at December 31, 2016, which resulted in a non-cash curtailment gain. This gain was recorded as an offset to restructuring and related costs in 2016. The Company also incurred $16.9 million of TVN acquisition- and integration-related expenses in 2016 and another $2.7 million in the nine months ended September 29, 2017. The Company expects to continue to have some TVN integration-related costs throughout the remainder of 2017, primarily consisting of outside legal and advisory fees relating to the re-organization of TVN’s legal entities. (See Note 3, “Business Acquisition,” for additional information on TVN acquisition-and integration-related expenses). In the three and nine months ended September 29, 2017, the Company recorded $0.1 million and $2.9 million of restructuring and related charges under the Harmonic 2016 Restructuring Plan, respectively. The restructuring and related charges under the Harmonic 2016 Restructuring Plan in the nine months ended September 29, 2017 consisted of $1.8 million of TVN VDP charges and $1.1 million of severance for 21 non-VDP employees worldwide who were terminated under this plan during the first six months of 2017. TVN VDP During 2016, the Company consulted and worked with the works council for the TVN French Subsidiary and applicable union representatives to establish a voluntary departure plan to enable French employees of TVN to voluntarily terminate with certain benefits. A total of 83 employees applied for the TVN VDP and were duly approved by the Company in the fourth quarter of 2016. The total TVN VDP costs, including severance, certain benefits and taxes, as well as administration costs, is estimated at approximately $15.3 million, in aggregate, at the inception of the plan and will be paid over a period of four years, based on the TVN VDP terms agreed with each employee. The total final payout to the employees may be different from the initial estimates depending on the final social charges imputed on each employee’s total income and benefits received. The Company does not expect the final payout to be materially different from the initial estimates. The fair value of the total TVN VDP liability at inception was estimated to be approximately $14.8 million. The Company accounts for these special termination benefits in accordance with ASC 712, “Compensation - Nonretirement Postemployment Benefits,” which requires that the special termination benefits be recognized as a liability and a loss beginning when an employee accepts the offer of voluntary termination and the amount can be reasonably estimated. Where an employee is required to work beyond a minimum statutory notice period, the cost of the special termination benefit is recognized as an expense over the employee’s remaining service period. Where the employee is not required to work beyond a minimum statutory notice period, the cost of the special termination benefit is recognized upon the date the employee accepts the offer of voluntary termination, provided that the amount of the benefit can be estimated. Out of the 83 employees who applied for TVN VDP, 11 of them are required to work beyond the minimum statutory notice period into 2017. Based on the application of the accounting guidance, the Company recorded $1.8 million and $13.1 million of TVN VDP costs in the first nine months of 2017 and in the year ended 2016, respectively. Cumulatively, the Company had paid an aggregate of $9.7 million of TVN VDP costs, of which $3.5 million was paid in 2016 and $6.2 million was paid in 2017. The fair value of the TVN VDP liability balance at September 29, 2017 was $6.0 million. The table below shows the estimated future payments for TVN VDP as of September 29, 2017 (in thousands):
Excess Facility in San Jose, California In January 2016, the Company exited an excess facility at its U.S. headquarters in San Jose, California and recorded $1.4 million in facility exit costs. The fair value of these liabilities is based on a net present value model using a credit-adjusted risk-free rate. The liability will be paid out over the remainder of the leased properties’ terms, which continue through August 2020. As of the cease-use date, the fair value of this restructuring liability totaled $2.5 million. Offsetting these charges was an adjustment for deferred rent liability relating to this space of $1.1 million. In December 2016, as a result of a change in estimated sublease income, the restructuring liability was increased by $0.6 million. The following table summarizes the activity in the Company’s restructuring accrual related to the Harmonic 2016 Restructuring Plan during the nine months ended September 29, 2017 (in thousands):
(1) See discussion of the TVN VDP above for future estimated payments through 2020. (2) The Company anticipates that the remaining severance and benefits accrual at September 29, 2017 will be fully paid in 2017. (3) The current portion and long-term portion of the restructuring liability are reported under “Accrued and other current liabilities” and “Other non-current liabilities”, respectively, on the Company’s Condensed Consolidated Balance Sheets. Harmonic 2017 Restructuring In the third quarter of 2017, the Company committed to a new restructuring plan (the “Harmonic 2017 Restructuring Plan”) to better align its operating costs with the continued decline in its net revenues. The restructuring activities under the Harmonic 2017 Restructuring Plan primarily consisted of global workforce reductions and an excess facility closure. In the three and nine months ended September 29, 2017, the Company recorded $2.4 million of restructuring and related charges under the Harmonic 2017 Restructuring Plan consisting of $2.1 million of employee severance and $0.3 million related to the closure of the Company’s research and development office in New York. The following table summarizes the activity in the Company’s restructuring accrual related to the Harmonic 2017 Restructuring Plan during the three months ended September 29, 2017 (in thousands):
(1) The Company anticipates that the remaining severance and benefits accrual at September 29, 2017 will be fully paid within the next twelve months. (2) The current portion and long-term portion of the restructuring liability are reported under “Accrued and other current liabilities” and “Other non-current liabilities”, respectively, on the Company’s Condensed Consolidated Balance Sheets. |
Convertible Notes, Other Debts And Capital Leases |
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Debt Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Convertible Notes, Other Debts And Capital Leases | CONVERTIBLE NOTES, OTHER DEBTS AND CAPITAL LEASES 4.00% Convertible Senior Notes In December 2015, the Company issued $128.25 million in aggregate principal amount of 4.0% unsecured convertible senior notes due December 1, 2020 (the “offering” or “Notes”, as applicable) through a private placement with a financial institution. The Notes do not contain any financial covenants and the Company can settle the Notes in cash, shares of common stock, or any combination thereof. The Notes can be converted under certain circumstances described below, based on an initial conversion rate of 173.9978 shares of common stock per $1,000 principal amount of Notes (which represents an initial conversion price of approximately $5.75 per share). Interest on the Notes is payable semiannually in arrears on June 1 and December 1 of each year. Concurrent with the closing of the offering, the Company used $49.9 million of the net proceeds to repurchase 11.1 million shares of the Company’s common stock from purchasers of the offering in privately negotiated transactions. In addition, the Company incurred approximately $4.1 million in debt issuance costs resulting in net proceeds to the Company of approximately $74.2 million, which was used to fund the TVN acquisition. Prior to September 1, 2020, holders of the Notes may convert the Notes at their option only under the following circumstances: (1) during any fiscal quarter commencing after the fiscal quarter ending on April 1, 2016, if the last reported sale price of the Company’s common stock for at least 20 trading days (whether or not consecutive) during a period of 30 consecutive trading days ending on the last trading day of the immediately preceding fiscal quarter is greater than or equal to 130% of the conversion price of the Notes on each applicable trading day; (2) during the five business day period after any five consecutive trading day period (the “measurement period”) in which the trading price per $1,000 principal amount of Notes for each trading day of the measurement period was less than 98% of the product of the last reported sale price of the Company’s common stock and the conversion rate on each such trading day; or (3) upon the occurrence of specified corporate events. Commencing on September 1, 2020 until the close of business on the second scheduled trading day immediately preceding the maturity date, the Notes will be convertible in multiples of $1,000 principal amount regardless of the foregoing circumstances. If a fundamental change occurs, holders of the Notes may require the Company to purchase all or any portion of their Notes for cash at a repurchase price equal to 100% of the principal amount of the Notes to be repurchased, plus any accrued and unpaid interest to, but excluding, the fundamental change repurchase date. In addition, if specific corporate events occur prior to the maturity date, the conversion rate may be increased for a holder who elects to convert the Notes in connection with such a corporate event. In accounting for the issuance of the Notes, the Company separated the Notes into liability and equity components. The carrying amount of the liability component was calculated by measuring the fair value of a similar liability that does not have an associated convertible feature. The carrying amount of the equity component representing the conversion option was determined by deducting the fair value of the liability component from the initial proceeds of the Notes as a whole. The difference between the initial proceeds of the Notes and the liability component (the “debt discount”) of $26.9 million is amortized to interest expense using the effective interest method over the term of the Notes. The equity component of the Notes is included in additional paid-in capital in the Condensed Consolidated Balance Sheets and is not remeasured as long as it continues to meet the conditions for equity classification. In accounting for the transaction costs related to the issuance of the Notes, the Company allocated the total amount of $4.1 million to the liability and equity components using the same proportions as the proceeds from the Notes. Transaction costs attributable to the liability component were $3.2 million and were recorded as a direct deduction from the carrying amount of the debt liability in long-term liability in the Condensed Consolidated Balance Sheets and are being amortized to interest expense in the Condensed Consolidated Statements of Operations using the effective interest method over the term of the Notes. Transaction costs attributable to the equity component were $0.9 million and were netted with the equity component of the Notes in additional paid-in capital in the Condensed Consolidated Balance Sheets. The following table presents the components of the Notes as of September 29, 2017 and December 31, 2016 (in thousands, except for years and percentages):
The following table presents interest expense recognized for the Notes (in thousands):
Other Debts and Capital Leases In connection with the TVN acquisition, the Company assumed a variety of debt and credit facilities in France to satisfy the financing requirements of TVN operations. These arrangements are summarized in the table below (in thousands):
(1) As of September 29, 2017, the Company’s TVN French Subsidiary had an aggregate of $20.2 million of loans due to various financing programs of French government agencies, $17.3 million of which are related to loans backed by R&D tax credit receivables. As of September 29, 2017, the TVN French Subsidiary had an aggregate of $26.5 million of R&D tax credit receivables from the French government from 2018 through 2021. (See Note 8, “Balance Sheet Components-Prepaid expenses and other current assets,” for more information). These tax loans have a fixed rate of 0.6%, plus EURIBOR 1 month + 1.3% and mature between 2018 through 2020. The remaining loans of $2.9 million at September 29, 2017 primarily relate to financial support from French government agencies for R&D innovation projects at minimal interest rates and these loans mature between 2020 through 2023. (2) One of the term loans with a certain financial institution contains annual covenants that require the TVN French Subsidiary to maintain a minimum working capital balance and various other financial covenants and restrictions that limit the French Subsidiary’s ability to incur additional indebtedness. The annual covenant is based on French statutory year-end results and the TVN French Subsidiary failed the 2016 covenant test primarily due to the Company’s plan to integrate TVN’s operations into other subsidiaries for tax planning and logistics purposes. In early 2017, the Company informed the financial institution of the 2016 covenant test results and was told by the financial institution to continue with the original payment schedule. The Company reported the entire loan balance with this financial institution under “Other debts and capital lease obligations, current” in the Condensed Consolidated Balance Sheets. The loan balance was approximately $0.4 million at both September 29, 2017 and December 31, 2016. Future minimum repayments The table below shows the future minimum repayments of debts and capital lease obligations for TVN as of September 29, 2017 (in thousands):
Line of Credit On September 27, 2017, the Company entered into a Loan and Security Agreement (the “Loan Agreement”) with Silicon Valley Bank (the “Bank”). The Loan Agreement provides for a secured revolving credit facility in an aggregate principal amount of up to $15.0 million. Under the terms of the Loan Agreement, the principal amount of loans, plus the face amount of any outstanding letters of credit, at any time cannot exceed up to 85% of the Company’s eligible receivables. Prior to November 1, 2017, the Company may borrow up to $7.5 million in excess of the borrowing base limit, calculated based on eligible accounts receivable balances. Under the terms of the Loan Agreement, the Company may also request letters of credit from the Bank. The proceeds of any loans under the Loan Agreement will be used for working capital and general corporate purposes. There were no borrowings under the Loan Agreement from the closing of the Loan Agreement through September 29, 2017. Loans under the Loan Agreement will bear interest, at the Company’s option, and subject to certain conditions, at an annual rate of either a prime rate or a LIBOR rate (each as customarily defined), plus an applicable margin. The applicable margin for LIBOR rate advances is 2.25%. There will be no applicable margin for prime rate advances when the Company is in compliance with the liquidity requirement of at least $20.0 million in the aggregate of consolidated cash plus availability under the Loan Agreement (the “Liquidity Requirement”) and a 0.25% margin for prime rate advances when the Company is not in compliance with the Liquidity Requirement. The Company may not request LIBOR advances when it is not in compliance with the Liquidity Requirement. Interest on each advance is due and payable monthly and the principal balance is due at maturity. The Company’s obligations under the revolving credit facility are secured by a security interest on substantially all of its assets, excluding intellectual property. The Loan Agreement contains customary affirmative and negative covenants limiting the Company’s ability and the ability of the Company’s subsidiaries, to, among other things, dispose of assets, undergo a change in control, merge or consolidate, make acquisitions, incur debt, incur liens, pay dividends, enter into affiliate transactions, repurchase stock and make investments, in each case subject to certain exceptions. The Company must comply with financial covenants requiring it to maintain (i) a short-term asset to short-term liabilities ratio of at least 1.10 to 1.00 and (ii) minimum adjusted EBITDA, in the amounts and for the periods as set forth in the Loan Agreement. The Company must also maintain a minimum liquidity amount, comprised of unrestricted cash held at accounts with the Bank plus proceeds available to be drawn under the Loan Agreement, equal to (i) at least $15.0 million at all times on or prior to October 31, 2017 and (ii) at least $10.0 million at all times on and after November 1, 2017. As of September 29, 2017, the Company was in compliance with the covenants under the Loan Agreement. |
Employee Benefit Plans and Stock-based Compensation |
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Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Employee Benefit Plans and Stock-based compensation | EMPLOYEE BENEFIT PLANS AND STOCK-BASED COMPENSATION Equity Award Plans The Company’s stock benefit plans include the employee stock purchase plan and current active stock plans adopted in 1995 and 2002 as well as one stock plan in connection with an acquisition in 2010. See Note 13, “Employee Benefit Plans and Stock-based Compensation” of Notes to Consolidated Financial Statements in the 2016 Form 10-K for details pertaining to each plan. The Company’s stockholders approved an amendment to the 1995 Stock Plan at the Company’s 2017 annual meeting of stockholders (the “2017 Annual Meeting”) which increased the number of shares of common stock reserved for issuance under the 1995 Stock Plan by 7,000,000 shares. The Company’s stockholders also approved an amendment to the 2002 Director Stock Plan at the 2017 Annual Meeting which increased the number of shares of common stock reserved for issuance under the 2002 Director Stock Plan by 400,000 shares. The following table summarizes the Company’s stock option, restricted stock units (“RSUs”), performance-based stock awards (“PRSUs”) and market-based awards activities during the nine months ended September 29, 2017 (in thousands, except per share amounts):
* Grants of RSUs and any non-statutory stock options issued at prices less than the fair market value on the date of grant decrease the plan reserve 1.5 shares for every unit or share granted and any forfeitures of these awards due to their not vesting would increase the plan reserve by 1.5 shares for every unit or share forfeited. ** The preceding table includes PRSUs and market-based award activities during the nine months ended September 29, 2017. Performance-based awards (PRSUs) In August 2016, the Company granted 898,533 shares of PRSUs to fund a portion of its 2016 incentive bonus payment obligations to its key executives and other eligible employees. From March 2017 through April 2017, the Company granted another 582,806 PRSUs to fund its first half 2017 incentive bonus payment obligations. The vesting of the PRSUs is based on the achievement of certain financial and non-financial operating goals of the Company and vesting occurs within three to six months from the grant date. Each quarterly period, the Company estimates the probability of the achievement of these performance goals and recognizes any related stock-based compensation expense. If the achievement of such performance goals is not probable, no compensation expense is recognized. Market-based awards In the nine months ended September 29, 2017, the Company granted 344,500 RSUs to its key executives and certain eligible employees that may vest during a three-year period as part of its long-term incentive program. The vesting conditions of these awards are tied to the market value of the Company's common stock. The fair value of these shares was estimated using a Monte-Carlo simulation. The following table summarizes information about stock options outstanding as of September 29, 2017 (in thousands, except per share amounts and terms):
The intrinsic value of options vested and expected to vest and exercisable as of September 29, 2017 is calculated based on the difference between the exercise price and the fair value of the Company’s common stock as of September 29, 2017. The intrinsic value of options exercised is calculated based on the difference between the exercise price and the fair value of the Company’s common stock as of the exercise date. The intrinsic value of options exercised during the three and nine months ended September 29, 2017 was $6,000 and $0.3 million, respectively. The intrinsic value of options exercised during both the three months and nine months ended September 30, 2016 was $0.1 million. The following table summarizes information about RSUs and PRSUs outstanding as of September 29, 2017 (in thousands, except term):
The fair value of RSUs and PRSUs vested and expected to vest as of September 29, 2017 is calculated based on the fair value of the Company’s common stock as of September 29, 2017. Employee Stock Purchase Plan (“ESPP”) The Company’s stockholders approved an amendment to the 2002 Employee Stock Purchase Plan (the “ESPP”) at the 2017 Annual Meeting which increased the number of shares of common stock reserved for issuance under the ESPP by 1,500,000 shares. As of September 29, 2017, the number of shares of common stock available for issuance under the ESPP was 1,114,796. In the event that there are insufficient shares in the plan to fully fund the issuance, the available shares will be allocated across all participants based on their contributions relative to the total contributions received for the offering period. Retirement Benefit Plan As part of the TVN acquisition the Company assumed obligations under a defined benefit pension plan. The plan is unfunded and there are no contributions to the plan required by any laws or funding regulations, discretionary contributions or non-cash contributions expected to be made. The table below shows the components of net periodic benefit costs (in thousands):
The present value of the Company’s pension obligation as of September 29, 2017 was $5.1 million, of which $55,000 was reported under “Accrued and other liabilities” and $5.0 million was reported under “Other non-current liabilities” on the Company’s Condensed Consolidated Balance Sheets. The present value of the Company’s pension obligation as of December 31, 2016 was $4.3 million. 401(k) Plan The Company has a retirement/savings plan for its U.S. employees, which qualifies as a thrift plan under Section 401(k) of the Internal Revenue Code. This plan allows participants to contribute up to the applicable Internal Revenue Code limitations under the plan. The Company has made discretionary contributions to the plan of 25% of the first 4% contributed by eligible participants, up to a maximum contribution per participant of $1,000 per year. The contributions for the nine months ended September 29, 2017 and September 30, 2016 were $326,000 and $316,000, respectively. Stock-based Compensation The following table summarizes stock-based compensation expense for all plans (in thousands):
As of September 29, 2017, the Company had approximately $13.5 million of unrecognized stock-based compensation expense related to unvested stock options and awards that are expected to be recognized over a weighted-average period of approximately 1.6 years. Valuation Assumptions The Company estimates the fair value of employee stock options and stock purchase rights under the ESPP using a Black-Scholes option valuation model. The value of the stock purchase rights under the ESPP consists of: (1) the 15% discount on the purchase of the stock; (2) 85% of the fair value of the call option; and (3) 15% of the fair value of the put option. The call option and put option were valued using the Black-Scholes option pricing model. At the date of grant, the Company estimated the fair value of each stock option grant and stock purchase right granted under the ESPP using the following weighted average assumptions:
There were no employee stock options granted in the three months ended September 29, 2017.
The expected term of the employee stock options represents the weighted-average period that the stock options are expected to remain outstanding. The computation of the expected term was determined based on historical experience of similar awards, giving consideration to the contractual terms of the stock-based awards, vesting schedules and expectations of future employee behavior. The expected term of the stock purchase rights under the ESPP represents the period of time from the beginning of the offering period to the purchase date. The Company uses its historical volatility for a period equivalent to the expected term of the options to estimate the expected volatility. The risk-free interest rate that the Company uses in the Black-Scholes option valuation model is based on U.S. Treasury zero-coupon issues with remaining terms similar to the expected term. The Company has never declared or paid any cash dividends and does not plan to pay cash dividends in the foreseeable future, and, therefore, used an expected dividend yield of zero in the valuation model. Prior to January 1, 2017, stock-based compensation expense was recorded net of estimated forfeitures in the Company’s condensed consolidated statements of operations and, accordingly, was recorded for only those stock-based awards that the Company expected to vest. Upon the adoption of the accounting standard update (ASU 2016-09, “Improvements to Employee Share-Based payments”) issued by FASB, effective January 1, 2017, the Company changed its accounting policy to account for forfeitures as they occur. The change was applied on a modified retrospective approach with a cumulative effect adjustment of $69,000 to retained earnings as of January 1, 2017 (which increased the accumulated deficit). The Company estimated the fair value of the market-based awards granted in March 2017 on the date of grant using a Monte Carlo simulation with the following assumptions: volatility 46.7%, risk-free interest rate 1.57% and dividend yield of 0%. Total compensation cost recognized related to these market-based awards was approximately $0.4 million and $0.8 million for the three and nine months ended September 29, 2017, respectively. As of September 29, 2017, $0.5 million of total unrecognized compensation cost related to these awards is expected to be recognized over a weighted-average period of approximately 0.56 years. The weighted-average fair value per share of options granted was $1.00 for the three months ended September 30, 2016. There were no options granted during the three months ended September 29, 2017. The weighted-average fair value per share of options granted was $1.85 and $0.97 for the nine months ended September 29, 2017 and September 30, 2016, respectively. The fair value of all stock options vested during the three months ended September 29, 2017 and September 30, 2016 was $0.3 million and $0.4 million, respectively. The fair value of all stock options vested during the nine months ended September 29, 2017 and September 30, 2016 was $1.4 million and $1.8 million, respectively. There were no realized tax benefits attributable to stock options exercised in jurisdictions where this expense is deductible for tax purposes for the three and nine months ended September 29, 2017 and September 30, 2016, respectively. The aggregate fair value of RSUs and PRSUs released during the three months ended September 29, 2017 and September 30, 2016 was $1.9 million and $1.6 million, respectively. The aggregate fair value of RSUs and PRSUs released during the nine months ended September 29, 2017 and September 30, 2016 was $9.2 million and $8.6 million, respectively. |
Income Taxes |
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Income Taxes | INCOME TAXES The Company reported the following operating results for the periods presented (in thousands):
The Company operates in multiple jurisdictions and its profits are taxed pursuant to the tax laws of these jurisdictions. The Company’s effective income tax rate may be affected by changes in, or interpretations of tax laws and tax agreements in any given jurisdiction, utilization of net operating loss and tax credit carry forwards, changes in geographical mix of income and expense, and changes in management’s assessment of matters such as the ability to realize deferred tax assets. The Company’s effective tax rate varies from year to year primarily due to the absence of several onetime, discrete items that benefited or decremented the tax rates in the previous years. The Company’s effective income tax rate of 2.2% for the nine months ended September 29, 2017 was different from the U.S. federal statutory rate of 35%, primarily due to the Company’s geographical income mix and favorable tax rates associated with certain earnings from operations in lower-tax jurisdictions, partially offset by the increase in the valuation allowance against U.S. federal, California and other state deferred tax assets and detriment from non-deductible stock-based compensation. In addition, in the first quarter of 2017, the Company was able to recognize a one-time tax benefit of approximately $1.2 million as a result of the merger of the Company’s two subsidiaries in Israel, which was approved by the Israeli government in the first quarter of 2017. In the third quarter of 2017, the Company recorded $2.4 million of tax benefit associated with the release of tax reserves for uncertain tax positions resulting from the expiration of the statutes of limitations on the Company’s US corporate tax returns for the 2013 tax year. For the nine months ended September 29, 2017, the remaining discrete adjustments to the Company's tax expense were primarily withholding taxes and the accrual of interest on uncertain tax positions. The Company's effective income tax rate of (0.8)% for the nine months ended September 30, 2016 was different from the U.S. federal statutory rate of 35%, primarily due to favorable tax rates associated with certain earnings from operations in lower-tax jurisdictions, and the tax benefit from the realization of certain deferred tax assets as a result of the TVN acquisition, partially offset by the increase in the valuation allowance against U.S. federal, California and other state deferred tax assets, detriment from non-deductible stock-based compensation, non-deductible amortization of foreign intangibles, and the net of various discrete tax adjustments. The Company files U.S. federal and state, and foreign income tax returns in jurisdictions with varying statutes of limitations during which such tax returns may be audited and adjusted by the relevant tax authorities. The 2014 through 2016 tax years generally remain subject to examination by U.S. federal and most state tax authorities. In significant foreign jurisdictions, the 2007 through 2016 tax years generally remain subject to examination by their respective tax authorities. In 2016, the U.S. Internal Revenue Service concluded its examination of the Company’s income tax return for the tax year 2012, which commenced in August 2015. In addition, a subsidiary of the Company was under audit for the 2012 and 2013 tax years, which commenced in 2015, by the Israel tax authority and concluded with no adjustment. If, upon the conclusion of an audit, the ultimate determination of taxes owed in the jurisdictions under audit is for an amount in excess of the tax provision the Company has recorded in the applicable period, the Company’s overall tax expense, effective tax rate, operating results and cash flow could be materially and adversely impacted in the period of adjustment. The Company’s operations in Switzerland are subject to a reduced tax rate under the Switzerland tax holiday which requires various thresholds of investment and employment in Switzerland. The Company has met these various thresholds and the Switzerland tax holiday is effective through the end of 2018. As of September 29, 2017, the total amount of gross unrecognized tax benefits, including interest and penalties, was approximately $17.6 million, of which $0.7 million would affect the Company’s effective tax rate if the benefits are eventually recognized. The remaining gross unrecognized tax benefit does not affect the Company’s effective tax rate as it relates to positions that would be settled with tax attributes such as net operating loss carryforward or tax credits previously subject to a valuation allowance. The Company recognizes interest and penalties related to unrecognized tax positions in income tax expense. The Company had $0.4 million of gross interest and penalties accrued as of September 29, 2017. The Company will continue to review its tax positions and provide for, or reverse, unrecognized tax benefits as issues arise. As of September 29, 2017, the Company anticipates that the balance of gross unrecognized tax benefits will decrease up to approximately $0.5 million due to expiration of the applicable statutes of limitations over the next 12 months. In March 2016, the FASB issued an accounting standard update for the accounting of share-based payment transactions, including the income tax consequences, classification of awards as either equity or liabilities and classification on the statement of cash flows. The new standard eliminated the requirement to report excess tax benefits and certain tax deficiencies related to share-based payment transactions as additional paid-in capital. It also removes the requirement to delay recognition of a windfall tax benefit until it reduces current taxes payable. Under the new guidance, the benefit will be recorded when it arises, subject to normal valuation allowance considerations. The Company adopted this new accounting standard beginning in the first quarter of fiscal 2017 using a modified-retrospective transition method and recorded a cumulative effect of $4.6 million of additional gross deferred tax asset associated with shared-based payment and an offsetting valuation allowance of the same amount, therefore resulting in no net impact to the Company’s beginning retained earnings. In October 2016, the FASB issued an accounting standard update which requires companies to recognize the income tax consequences of all intra-entity sales of assets other than inventory when they occur. As a result, a reporting entity would recognize the tax expense from the sale of the asset in the seller’s tax jurisdiction when the transfer occurs, even though the pre-tax effects of that transaction are eliminated in consolidation. Any deferred tax asset that arises in the buyer’s jurisdiction would also be recognized at the time of the transfer. The Company early adopted this accounting standard update during the first quarter of fiscal 2017 on a modified retrospective approach and recorded a cumulative-effect adjustment of $1.4 million to the retained earnings as of January 1, 2017 (which reduced the accumulated deficit). Correspondingly, in the first quarter of fiscal 2017, the Company recognized an additional $1.1 million of net deferred tax assets, after netting with $2.1 million of valuation allowance, and write off the remaining $0.3 million of unamortized tax expenses deferred under the previous guidance to provision for income taxes in the first quarter of fiscal 2017. |
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Income (Loss) Per Share | NET LOSS PER SHARE The following table sets forth the computation of the basic and diluted net loss per share (in thousands, except per share amounts):
The diluted net loss per share is the same as basic net loss per share for the three and nine months ended September 29, 2017 and September 30, 2016 because potential common shares are only considered when their effect would be dilutive. The following table sets forth the potential weighted common shares outstanding that were excluded from the computation of basic and diluted net loss per share calculations (in thousands):
(1) On September 26, 2016, in connection with the execution of a product supply agreement pursuant to which an affiliate of Comcast Corporation (together with Comcast Corporation, “Comcast”) may, in its sole discretion, purchase from the Company licenses to certain of the Company’s software products, the Company granted Comcast a warrant to purchase shares of its common stock. (See Note 15, “Warrants” for additional information). Excluded from the table above are the Notes, which are convertible under certain conditions into an aggregate of 22,304,348 shares of common stock. (See Note 11, “Convertible Notes, Other Debts and Capital Leases” for additional information on the Notes). Since the Company’s intent is to settle the principal amount of the Notes in cash, the treasury stock method is being used to calculate any potential dilutive effect of the conversion spread on diluted net income per share, if applicable. The conversion spread will have a dilutive impact on diluted net income per share when the Company’s average market price of its common stock for a given period exceeds the conversion price of $5.75 per share. |
Warrants (Notes) |
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Equity [Abstract] | |
Warrants Disclosure | WARRANTS On September 26, 2016, the Company issued a Warrant to Comcast pursuant to which Comcast may, subject to certain vesting provisions, purchase up to 7,816,162 shares of the Company’s common stock subject to adjustment in accordance with the terms of the Warrant, for a per share exercise price of $4.76. Comcast may exercise the Warrant for cash or on a net share basis. The Warrant expires on September 26, 2023 or the prior consummation of a change of control of the Company. Comcast’s right to purchase 781,617 shares was vested as of the issuance date as an incentive to enter into the software license product supply agreement. Comcast’s rights to purchase an additional 1,954,042 shares vest upon achievement of milestones that occur upon or prior to Comcast’s election for enterprise license pricing for certain of the Company’s software products. Such pricing would obligate Comcast to make certain total payments to the Company over the term of the product supply agreement. These rights are expected to vest in 2018. Comcast’s rights to purchase an additional 1,172,425 shares vest when Comcast exceeds specified cumulative purchase amounts from the Company under the product supply agreement. Comcast’s rights to purchase the remaining 3,908,081 shares vest in specified tranches at the earlier of Comcast’s enterprise license pricing election (if completed by a certain date) or achievement of specified cumulative purchase amounts from the Company. The $1.6 million value of the vested portion of the Warrant has been determined using the Black-Scholes option valuation model using the following assumptions: expected term of 7 years, volatility of 42%, risk-free interest rate of 1.4%, and expected dividends of 0.0%. The Warrant is considered indexed to the Company’s common stock and classified as stockholders’ equity based on its terms. Accordingly, the vested Warrant amount was included in “Additional paid-in capital” on the Company’s Condensed Consolidated Balance Sheet and will not be remeasured in the future periods. The Warrant is considered an incentive for Comcast to purchase certain of the Company’s products. Therefore the value of the Warrant is recorded as a reduction in the Company’s net revenues to the extent such value does not exceed net revenues from pertinent sales to Comcast. The portion of the Warrant which vested on September 26, 2016 had a value of approximately $1.6 million and is deemed a customer incentive paid upfront and cumulatively, $0.5 million of this prepaid incentive has been recorded as a reduction to the Company’s net revenues from Comcast. The remaining $1.1 million of this prepaid incentive is reported as an asset under “Prepaid expenses and other current assets” on the Company’s Condensed Consolidated Balance Sheet as of September 29, 2017. The Company considers this asset to be recoverable based on the expectation of Comcast’s future purchases of the pertinent products. |
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Equity [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Stockholders' Equity | STOCKHOLDERS’ EQUITY Accumulated Other Comprehensive Income (Loss) (“AOCI”) The components of AOCI, on an after-tax basis where applicable, were as follows (in thousands):
The effects of amounts reclassified from AOCI into the Condensed Consolidated Statement of Operations were as follows (in thousands):
As of September 29, 2017, there was no AOCI balance, and during the nine months ended September 29, 2017, there were no reclassifications from AOCI, as there were no cash flow hedge contracts outstanding at September 29, 2017 and December 31, 2016. Common Stock Repurchases Our stock repurchase program expired on December 31, 2016. Further stock repurchases would require authorization from the Board. |
Segment Information |
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Segment Information | SEGMENT INFORMATION Operating segments are defined as components of an enterprise that engage in business activities for which separate financial information is available and evaluated by the Company’s Chief Operating Decision Maker ( the “CODM”), which for Harmonic is its Chief Executive Officer, in deciding how to allocate resources and assess performance. Based on our internal reporting structure, the Company consists of two operating segments: Video and Cable Edge. The operating segments were determined based on the nature of the products offered. The Video segment sells video processing and production and playout solutions and services worldwide to broadcast and media companies, streaming new media companies, cable operators, and satellite and telecommunications (telco) Pay-TV service providers. The Cable Edge segment sells cable edge solutions and related services to cable operators globally. On February 29, 2016, the Company completed its acquisition of 100% of the outstanding equity of TVN and assigned TVN to its Video operating segment. The Company does not allocate amortization of intangibles, stock-based compensation, restructuring and related charges, TVN acquisition- and integration-related costs, and certain other non-recurring charges to the operating income for each segment because management does not include this information in the measurement of the performance of the operating segments. A measure of assets by segment is not applicable as segment assets are not included in the discrete financial information provided to the CODM. The following tables provide summary financial information by reportable segment (in thousands):
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Commitments and Contingencies |
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Commitments and Contingencies Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Commitments and Contingencies | COMMITMENTS AND CONTINGENCIES Leases Future minimum lease payments under non-cancelable operating leases as of September 29, 2017 are as follows (in thousands):
Warranties The Company accrues for estimated warranty costs at the time of product shipment. Management periodically reviews the estimated fair value of its warranty liability and records adjustments based on the terms of warranties provided to customers, historical and anticipated warranty claims experience, and estimates of the timing and cost of warranty claims. Activity for the Company’s warranty accrual, which is included in accrued and other current liabilities, is summarized below (in thousands):
Purchase Obligations The Company relies on a limited number of contract manufacturers and suppliers to provide manufacturing services for a substantial majority of its products. Obligations to purchase inventory and other commitments are generally expected to be fulfilled within one year. The Company had approximately $27.8 million of non-cancelable commitments to purchase inventories and other commitments as of September 29, 2017. Standby Letters of Credit and Guarantees The Company’s financial guarantees consisted of standby letters of credit and bank guarantees. As of September 29, 2017, the Company had $0.8 million of standby letters of credit outstanding primarily related to its credit card facility in Switzerland and, to a lesser extent, performance bond and state requirements imposed on employers. In addition, the Company had $1.9 million of bank guarantees outstanding as of September 29, 2017, of which $1.3 million was related to a building lease for the TVN French Subsidiary, $0.3 million was related to the building leases in Israel, and the remaining amount was mostly related to performance bonds issued to customers of the TVN French Subsidiary. Indemnification Harmonic is obligated to indemnify its officers and the members of its Board of Directors (the “Board”) pursuant to its bylaws and contractual indemnity agreements. Harmonic also indemnifies some of its suppliers and most of its customers for specified intellectual property matters pursuant to certain contractual arrangements, subject to certain limitations. The scope of these indemnities varies, but, in some instances, includes indemnification for damages and expenses (including reasonable attorneys’ fees). There have been no amounts accrued in respect of these indemnification provisions through September 29, 2017. Legal proceedings In October 2011, Avid Technology, Inc. (“Avid”) filed a complaint in the United States District Court for the District of Delaware alleging that our MediaGrid product infringes two patents held by Avid. A jury trial on this complaint commenced on January 23, 2014 and, on February 4, 2014, the jury returned a unanimous verdict in favor of us, rejecting Avid’s infringement allegations in their entirety. In January 2015, Avid filed an appeal with respect to the jury’s verdict with the Federal Circuit. In January 2016, the Federal Circuit issued an order vacating the verdict of noninfringement and remanding the case to the trial court for a new trial on infringement. In June 2012, Avid served a subsequent complaint in the United States District Court for the District of Delaware alleging that our Spectrum product infringes one patent held by Avid. The complaint sought injunctive relief and unspecified damages. In September 2013, the U.S. Patent Trial and Appeal Board (“PTAB”) authorized an inter partes review to be instituted as to claims 1-16 of the patent asserted in this second complaint. In July 2014, the PTAB issued a decision finding claims 1-10 invalid and claims 11-16 not invalid. We filed an appeal with respect to the PTAB’s decision on claims 11-16 in September 2014, and the Federal Circuit affirmed the PTAB’s decision in April 2016. In July 2017, the court issued a scheduling order consolidating both cases and setting the trial date for November 6, 2017. On October 19, 2017, the parties agreed to settle the consolidated cases by entering into a settlement and patent portfolio cross-license agreement, and the cases were dismissed with prejudice. The settlement included a multi-year patent portfolio cross-license. In connection with the agreement, the Company recorded a $6.0 million litigation settlement expense in the three months ended September 29, 2017 and this expense is included in “Selling, general and administrative expenses” in the Company’s Condensed Consolidated Statement of Operations. The associated $6.0 million settlement liability is recorded as $2.5 million and $3.5 million in “Accrued Liabilities” and “Other non-current liabilities”, respectively, in the Company’s Condensed Consolidated Balance Sheets as of September 29, 2017. On October 24, 2017, the Company paid the first $2.5 million to Avid in accordance with the terms of the settlement agreement and the remaining $1.5 million and $2.0 million will be paid in the second quarter of 2019 and the third quarter of 2020, respectively. From time to time, the Company is involved in lawsuits as well as subject to various legal proceedings, claims, threats of litigation, and investigations in the ordinary course of business, including claims of alleged infringement of third-party patents and other intellectual property rights, commercial, employment, and other matters. The Company assesses potential liabilities in connection with each lawsuit and threatened lawsuits and accrues an estimated loss for these loss contingencies if both of the following conditions are met: information available prior to issuance of the financial statements indicates that it is probable that a liability has been incurred at the date of the financial statements and the amount of loss can be reasonably estimated. While certain matters to which the Company is a party specify the damages claimed, such claims may not represent reasonably probable losses. Given the inherent uncertainties of litigation, the ultimate outcome of these matters cannot be predicted at this time, nor can the amount of possible loss or range of loss, if any, be reasonably estimated. The Company is unable to predict the outcome of these lawsuits and therefore is unable to estimate an amount or range of any reasonably possible losses resulting from them. An unfavorable outcome on any litigation matter could require that the Company pay substantial damages, or, in connection with any intellectual property infringement claims, could require that the Company pay ongoing royalty payments or could prevent the Company from selling certain of its products. As a result, a settlement of, or an unfavorable outcome on, any of the matters referenced above or other litigation matters could have a material adverse effect on the Company’s business, operating results, financial condition and cash flows. |
Basis of Presentation and Significant Accounting Policies (Policies) |
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Accounting Policies [Abstract] | |||||||||||||
Use of Estimates | Use of Estimates The preparation of the condensed consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting period. Actual results could differ from those estimates. |
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Business Combinations Policy | On February 29, 2016, the Company completed the acquisition of Thomson Video Networks (“TVN”). TVN is now a part of the Company’s Video segment and its results of operations are included in the Company’s Condensed Consolidated Statements of Operations beginning March 1, 2016. During the fourth quarter of 2016, the Company completed the accounting for this business combination. |
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Significant Accounting Policies | The Company’s significant accounting policies are described in Note 2 to its audited Consolidated Financial Statements included in the 2016 Form 10-K. There have been no significant changes to these policies during the nine months ended September 29, 2017 other than those disclosed in Note 2, “Standards Implemented”. |
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Recent Accounting Pronouncements | RECENT ACCOUNTING PRONOUNCEMENTS New standards to be implemented In May 2014, the Financial Accounting Standards Board (“FASB”) issued a new standard, Accounting Standards Update (“ASU”) No. 2014-09, Revenue from Contracts with Customers, as amended, which will supersede nearly all existing revenue recognition guidance. Under ASU 2014-09, an entity is required to recognize revenue upon transfer of promised goods or services to customers in an amount that reflects the expected consideration received in exchange for those goods or services. ASU No. 2014-09 defines a five-step process in order to achieve this core principle, which may require the use of judgment and estimates, and also requires expanded qualitative and quantitative disclosures relating to the nature, amount, timing and uncertainty of revenue and cash flows arising from contracts with customers, including significant judgments and estimates used. The FASB has issued several amendments to the new standard, including clarification on accounting for licenses of intellectual property and identifying performance obligations. The amendments include ASU No. 2016-08, Revenue from Contracts with Customers (Topic 606)-Principal versus Agent Considerations, which was issued in March 2016, and clarifies the implementation guidance for principal versus agent considerations in ASU 2014-09, and ASU No. 2016-10, Revenue from Contracts with Customers (Topic 606)-Identifying Performance Obligations and Licensing, which was issued in April 2016, and amends the guidance in ASU No. 2014-09 related to identifying performance obligations and accounting for licenses of intellectual property. The new standard permits adoption either by using (i) a full retrospective approach for all periods presented in the period of adoption or (ii) a modified retrospective approach with the cumulative effect of initially applying the new standard recognized at the date of initial application and providing certain additional disclosures. The new standard is effective for annual reporting periods beginning after December 15, 2017, with early adoption permitted for annual reporting periods beginning after December 15, 2016. The Company will adopt the new standard effective January 1, 2018. The Company currently plans to adopt using the modified retrospective approach. However, a decision regarding the adoption method has not been finalized at this time. The Company’s final determination will depend on a number of factors, such as the significance of the impact of the new standard on its financial results, system readiness, including that of software procured from third-party providers, and its ability to accumulate and analyze the information necessary to assess the impact on prior period financial statements, as necessary. The Company is currently evaluating the impact of the new standard on its accounting policies, processes, and system requirements. The Company has made and will continue to make investments in systems to enable timely and accurate reporting under the new standard. While the Company continues to assess all potential impacts under the new standard, there is the potential for significant impacts to the timing of recognition of software licenses with undelivered features and professional services revenue related to service contracts with acceptance terms as well as contract acquisition costs, both with respect to the amounts that will be capitalized as well as the period of amortization. Under current industry-specific software revenue recognition guidance, the Company has historically concluded that it did not have vendor-specific objective evidence (“VSOE”) of fair value of the undelivered features relating to delivered software licenses, and accordingly, it has deferred entire revenue for such software licenses until the delivery of features. Professional services included in arrangements with acceptances have also been recognized on receipt of acceptance. The new standard, which does not retain the concept of VSOE, requires an evaluation of whether the undelivered features are distinct performance obligations and, therefore, should be separately recognized when delivered compared to the timing of delivery of software license. Professional services will generally be recorded as services are provided. Depending on the outcome of the Company’s evaluation, the timing of when revenue is recognized could change for future features and professional services under the new standard. As part of the Company’s preliminary evaluation, it has also considered the impact of the guidance in ASC 340-40, Other Assets and Deferred Costs; Contracts with Customers, and the interpretations of the FASB Transition Resource Group for Revenue Recognition (“TRG”) from their November 7, 2016 meeting with respect to capitalization and amortization of incremental costs of obtaining a contract. As a result of this new guidance, the Company is currently assessing if it will need to capitalize any costs of obtaining the contract, including additional sales commissions. Under the Company’s current accounting policy, it expenses the commission costs immediately as incurred. While the Company continues to assess the potential impacts of the new standard, including the areas described above, the Company does not know or cannot yet reasonably estimate quantitative information related to the impact of the new standard on its financial statements at this time. In January 2016, the FASB issued an accounting standard update which requires equity investments to be measured at fair value with changes in fair value recognized in net income and simplifies the impairment assessment of equity investments without readily determinable fair values by requiring a qualitative assessment to identify impairment. The accounting standard update also updates certain presentation and disclosure requirements. This accounting standard update will be effective for the Company beginning in the first quarter of fiscal 2018 and early adoption is permitted. The adoption of this new standard is not expected to have a material impact on the Company’s consolidated financial statements. In February 2016, the FASB amended the existing accounting standard for lease accounting. Under this guidance, lessees and lessors should apply a “right-of-use” model in accounting for all leases (including subleases) and eliminate the concept of operating leases and off-balance sheet leases. This new leases standard requires a modified retrospective transition approach for all leases existing at, or entered into after, the date of initial application, with an option to use certain transition relief. The new standard will be effective for the Company beginning in the first quarter of fiscal 2019 and early adoption is permitted. The Company is currently evaluating the methods and impact of adopting this new leases standard on its consolidated financial statements. In June 2016, the FASB issued new guidance that changes the impairment model for most financial assets and certain other instruments. For trade receivables and other instruments, the Company will be required to use a new forward-looking “expected loss” model. Additionally, credit losses on available-for-sale debt securities should be recorded through an allowance for credit losses limited to the amount by which fair value is below amortized cost. The new guidance will be effective for the Company beginning in the first quarter of fiscal 2019 and early adoption is permitted. The Company is currently evaluating the impact of adopting this new accounting guidance on its consolidated financial statements. In August 2016, the FASB issued an accounting standard update that addresses eight specific cash flow issues with the objective of reducing the existing diversity in practice. This accounting standard update will be effective for the Company beginning in the first quarter of fiscal 2018 on a retrospective basis, and early adoption is permitted. The adoption of this new standard is not expected to have a material impact on the Company’s consolidated financial statements. In November 2016, the FASB issued an accounting standard update which requires companies to include restricted cash and restricted cash equivalents in its cash and cash equivalent balances in the statement of cash flows. Transfers between cash, cash equivalents, restricted cash, and restricted cash equivalents are no longer presented in the statement of cash flows. The new guidance requires a reconciliation of the totals in the statement of cash flows to the related captions. This accounting standard update will be effective for the Company beginning in the first quarter of fiscal 2018 on a retrospective basis, and early adoption is permitted. The adoption of this new guidance is not expected to have a material impact on the Company’s consolidated financial statements. In January 2017, the FASB issued an accounting standard update to simplify the test for goodwill impairment. It removes Step 2 of the goodwill impairment test and requires the assessment of fair value of individual assets and liabilities of a reporting unit to measure goodwill impairments. Goodwill impairment will now be the amount by which a reporting unit's carrying value exceeds its fair value. The accounting standard update will be effective for the Company beginning in the first quarter of fiscal 2020 on a prospective basis, and early adoption is permitted. The Company is currently evaluating the impact of adopting this new accounting guidance on its consolidated financial statements. In January 2017, the FASB issued an accounting standard update to clarify the definition of a business with the objective of adding guidance to assist entities with evaluating whether transactions should be accounted for as acquisitions (or disposals) of assets or businesses. The definition of a business affects many areas of accounting including acquisitions, disposals, goodwill, and consolidation. The guidance will be effective for the Company beginning in the first quarter of fiscal 2018 on a prospective basis, and early adoption is permitted. The adoption of this new guidance is not expected to have a material impact on the Company’s consolidated financial statements. In March 2017, the FASB issued a new accounting standard to improve the presentation of net periodic pension cost and net periodic post-retirement benefit cost. This new standard will be effective for the Company beginning in the first quarter of fiscal 2018 on a retrospective basis and early adoption is permitted. The adoption of this new guidance is not expected to have a material impact on the Company’s consolidated financial statements. In May 2017, the FASB issued a new accounting standard to clarify when to account for a change to the terms or conditions for a share-based payment award as a modification. It requires modification accounting only if the fair value, the vesting condition or the classification of the award changes as a result of the change in terms or conditions. This new standard will be effective for the Company beginning in the first quarter of fiscal 2018 on a prospective basis and early adoption is permitted. The adoption of this new standard is not expected to have a material impact on the Company’s consolidated financial statements. Standards Implemented In February 2015, the FASB issued an accounting standard update that changes the analysis that a reporting entity must perform to determine whether it should consolidate certain types of legal entities. The accounting standard update became effective for the Company beginning in the first quarter of fiscal 2017. The application of this accounting standard update did not have any impact on the Company's Consolidated Balance Sheet or Statement of Operations upon adoption. In July 2015, the FASB issued an accounting standard update that requires inventory to be measured at the lower of cost and net realizable value. Net realizable value is the estimated selling prices in the ordinary course of business, less reasonably predictable costs of completion, disposal, and transportation. The Company adopted this accounting standard update beginning in the first quarter of fiscal 2017 and the adoption did not have a material impact on its consolidated financial statements. In March 2016, the FASB issued an accounting standard update to clarify the requirements for assessing whether contingent call (put) options that can accelerate the payment of principal on debt instruments are clearly and closely related to their debt hosts. An entity performing the assessment under the amendments is required to assess the embedded call (put) options solely in accordance with the four-step decision sequence. The Company adopted this accounting standard update beginning in the first quarter of fiscal 2017 and the adoption did not have any impact on its consolidated financial statements. In March 2016, the FASB issued an accounting standard update for the accounting of share-based payment transactions, including the income tax consequences, classification of awards as either equity or liabilities and classification on the statement of cash flows. The new standard eliminated the requirement to report excess tax benefits and certain tax deficiencies related to share-based payment transactions as additional paid-in capital. It also removes the requirement to delay recognition of a windfall tax benefit until it reduces current taxes payable. Under the new guidance, the benefit will be recorded when it arises, subject to normal valuation allowance considerations. The Company adopted this new accounting standard beginning in the first quarter of fiscal 2017 using a modified-retrospective transition method and recorded a cumulative effect of $4.6 million of additional gross deferred tax asset associated with shared-based payment and an offsetting valuation allowance of the same amount, therefore resulting in no net impact to the Company’s beginning retained earnings. Prior to January 1, 2017, stock-based compensation expense was recorded net of estimated forfeitures in the Company’s condensed consolidated statements of operations and, accordingly, was recorded for only those stock-based awards that the Company expected to vest. Upon the adoption of this accounting standard update, effective January 1, 2017, the Company changed its accounting policy to account for forfeitures as they occur. The change was applied on a modified retrospective approach with a cumulative effect adjustment of $69,000 to retained earnings as of January 1, 2017 (which increased the accumulated deficit). The implementation of this accounting standard update has no impact to the Company’s condensed statement of cash flows because the Company does not have any excess tax benefits from share-based compensation because its tax provision is primarily under full valuation allowance. No prior periods were recast as a result of this change in accounting policy. In October 2016, the FASB issued an accounting standard update which requires companies to recognize the income tax consequences of all intra-entity sales of assets other than inventory when they occur. As a result, a reporting entity would recognize the tax expense from the sale of the asset in the seller’s tax jurisdiction when the transfer occurs, even though the pre-tax effects of that transaction are eliminated in consolidation. Any deferred tax asset that arises in the buyer’s jurisdiction would also be recognized at the time of the transfer. The Company early adopted this accounting standard update during the first quarter of fiscal 2017 on a modified retrospective approach and recorded a cumulative-effect adjustment of $1.4 million to the retained earnings as of January 1, 2017 (which reduced the accumulated deficit). Correspondingly, in the first quarter of fiscal 2017, the Company recognized an additional $1.1 million of net deferred tax assets, after netting with $2.1 million of valuation allowance, and write off the remaining $0.3 million of unamortized tax expenses deferred under the previous guidance to provision for income taxes in the first quarter of fiscal 2017. |
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Short-term Investment Policy | The Company’s short-term investments as of December 31, 2016 had maturities of less than one year. These available-for-sale investments are presented as “Current Assets” in the Condensed Consolidated Balance Sheets as they were available for current operations. |
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Investments in Other Equity Securities | The assessment as to the nature of a decline in fair value is based on, among other things, the length of time and the extent to which the market value has been less than the Company’s cost basis; the financial condition and near-term prospects of the investment; and the Company’s intent and ability to retain the investment for a period of time sufficient to allow for any anticipated recovery in market value. |
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Derivatives and Hedging Activities | The Company uses forward contracts to manage exposures to foreign currency exchange rates. The Company’s primary objective in holding derivative instruments is to reduce the volatility of earnings and cash flows associated with fluctuations in foreign currency exchange rates and the Company does not use derivative instruments for trading purposes. The use of derivative instruments expose the Company to credit risk to the extent that the counterparties may be unable to meet their contractual obligations, as such, the potential risk of loss with any one counterparty is closely monitored by the Company. Derivatives Not Designated as Hedging Instruments (Balance Sheet Hedges) The Company’s balance sheet hedges consist of foreign currency forward contracts, mature generally within three months, are carried at fair value and are used to minimize the short-term impact of foreign currency exchange rate fluctuation on cash and certain trade and inter-company receivables and payables. Changes in the fair value of these foreign currency forward contracts are recognized in “Other expense, net” in the Condensed Consolidated Statement of Operations and are largely offset by the changes in the fair value of the assets or liabilities being hedged. Offsetting of Derivative Assets and Liabilities The Company recognizes all derivative instruments on a gross basis in the Condensed Consolidated Balance Sheets. However, the arrangements with its counterparties allows for net settlement, which are designed to reduce credit risk by permitting net settlement with the same counterparty. |
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Fair Value of Financial Instruments | The applicable accounting guidance establishes a framework for measuring fair value and requires disclosure about the fair value measurements of assets and liabilities. This guidance requires the Company to classify and disclose assets and liabilities measured at fair value on a recurring basis, as well as fair value measurements of assets and liabilities measured on a nonrecurring basis in periods subsequent to initial measurement, in a three-tier fair value hierarchy as described below. The guidance defines fair value as the exchange price that would be received for an asset or paid to transfer a liability, in the principal or most advantageous market for the asset or liability, in an orderly transaction between market participants on the measurement date. Valuation techniques used to measure fair value must maximize the use of observable inputs and minimize the use of unobservable inputs. The guidance describes three levels of inputs that may be used to measure fair value:
The carrying value of the Company’s financial instruments, including cash equivalents, restricted cash, accounts receivable, accounts payable and accrued and other current liabilities, approximate fair value due to their short maturities. The Company uses the market approach to measure fair value for its financial assets and liabilities. The market approach uses prices and other relevant information generated by market transactions involving identical or comparable assets or liabilities. The fair value of the Company’s convertible notes is influenced by interest rates, the Company’s stock price and stock market volatility. The estimated fair value of the Company’s convertible notes based on a market approach was approximately $114.2 million and $143.5 million as of September 29, 2017 and December 31, 2016, respectively, and represents a Level 2 valuation. The Company’s other debts and capital leases assumed from the TVN acquisition are classified within Level 2 because these borrowings are not actively traded and the majority of them have a variable interest rate structure based upon market rates currently available to the Company for debt with similar terms and maturities. Additionally, the Company considers the carrying amount of its capital lease obligations to approximate their fair value because the weighted average interest rate used to formulate the carrying amounts approximates current market rates. The other debts and capital leases outstanding as of September 29, 2017 were $22.9 million in the aggregate. (See Note 11, “Convertible Notes, Other debts and Capital Leases” for additional information). The fair value of the Company’s liability for the TVN voluntary departure plan (“TVN VDP”) as of September 29, 2017 of $6.0 million is classified within Level 3 because discount rates which are unobservable in the market were being used to measure the fair value of this liability. (See Note 10, “Restructuring and related Charges-TVN VDP” for additional information). The fair value of the TVN defined pension benefit plan liability of $5.1 million as of September 29, 2017 is disclosed in Note 12, “Employee Benefit Plans and Stock-based Compensation-TVN Retirement Benefit Plan.” During the nine months ended September 29, 2017, there were no nonrecurring fair value measurements of assets and liabilities subsequent to initial recognition. |
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Goodwill and Intangible Assets, Goodwill | Application of the goodwill impairment test requires judgment, including the identification of reporting units, assigning assets and liabilities to reporting units, assigning goodwill to reporting units, and determining the fair value of each reporting unit. Significant judgments required to estimate the fair value of reporting units include estimating future cash flows and determining appropriate discount rates, growth rates, an appropriate control premium and other assumptions. Changes in these estimates and assumptions could materially affect the determination of fair value for each reporting unit which could trigger impairment. If the Company’s assumptions and related estimates change in the future, or if the Company’s reporting structure changes or other events and circumstances change (e.g. such as a sustained decrease in the Company’s stock price), the Company may be required to record impairment charges in future periods. Any impairment charges that the Company may take in the future could be material to its results of operations and financial condition. |
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Restructuring and Related Charges | The fair value of these liabilities is based on a net present value model using a credit-adjusted risk-free rate. The liability will be paid out over the remainder of the leased properties’ terms, which continue through August 2020. |
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Share-based Compensation Expense | In March 2016, the FASB issued an accounting standard update for the accounting of share-based payment transactions, including the income tax consequences, classification of awards as either equity or liabilities and classification on the statement of cash flows. The new standard eliminated the requirement to report excess tax benefits and certain tax deficiencies related to share-based payment transactions as additional paid-in capital. It also removes the requirement to delay recognition of a windfall tax benefit until it reduces current taxes payable. Under the new guidance, the benefit will be recorded when it arises, subject to normal valuation allowance considerations. The Company adopted this new accounting standard beginning in the first quarter of fiscal 2017 using a modified-retrospective transition method and recorded a cumulative effect of $4.6 million of additional gross deferred tax asset associated with shared-based payment and an offsetting valuation allowance of the same amount, therefore resulting in no net impact to the Company’s beginning retained earnings. Prior to January 1, 2017, stock-based compensation expense was recorded net of estimated forfeitures in the Company’s condensed consolidated statements of operations and, accordingly, was recorded for only those stock-based awards that the Company expected to vest. Upon the adoption of this accounting standard update, effective January 1, 2017, the Company changed its accounting policy to account for forfeitures as they occur. The change was applied on a modified retrospective approach with a cumulative effect adjustment of $69,000 to retained earnings as of January 1, 2017 (which increased the accumulated deficit). The implementation of this accounting standard update has no impact to the Company’s condensed statement of cash flows because the Company does not have any excess tax benefits from share-based compensation because its tax provision is primarily under full valuation allowance. The Company estimates the fair value of employee stock options and stock purchase rights under the ESPP using a Black-Scholes option valuation model. The value of the stock purchase rights under the ESPP consists of: (1) the 15% discount on the purchase of the stock; (2) 85% of the fair value of the call option; and (3) 15% of the fair value of the put option. The call option and put option were valued using the Black-Scholes option pricing model. The expected term of the employee stock options represents the weighted-average period that the stock options are expected to remain outstanding. The computation of the expected term was determined based on historical experience of similar awards, giving consideration to the contractual terms of the stock-based awards, vesting schedules and expectations of future employee behavior. The expected term of the stock purchase rights under the ESPP represents the period of time from the beginning of the offering period to the purchase date. The Company uses its historical volatility for a period equivalent to the expected term of the options to estimate the expected volatility. The risk-free interest rate that the Company uses in the Black-Scholes option valuation model is based on U.S. Treasury zero-coupon issues with remaining terms similar to the expected term. The Company has never declared or paid any cash dividends and does not plan to pay cash dividends in the foreseeable future, and, therefore, used an expected dividend yield of zero in the valuation model. Prior to January 1, 2017, stock-based compensation expense was recorded net of estimated forfeitures in the Company’s condensed consolidated statements of operations and, accordingly, was recorded for only those stock-based awards that the Company expected to vest. Upon the adoption of the accounting standard update (ASU 2016-09, “Improvements to Employee Share-Based payments”) issued by FASB, effective January 1, 2017, the Company changed its accounting policy to account for forfeitures as they occur. The change was applied on a modified retrospective approach with a cumulative effect adjustment of $69,000 to retained earnings as of January 1, 2017 (which increased the accumulated deficit). |
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Income Tax | The Company recognizes interest and penalties related to unrecognized tax positions in income tax expense. The Company had $0.4 million of gross interest and penalties accrued as of September 29, 2017. The Company will continue to review its tax positions and provide for, or reverse, unrecognized tax benefits as issues arise. As of September 29, 2017, the Company anticipates that the balance of gross unrecognized tax benefits will decrease up to approximately $0.5 million due to expiration of the applicable statutes of limitations over the next 12 months. In March 2016, the FASB issued an accounting standard update for the accounting of share-based payment transactions, including the income tax consequences, classification of awards as either equity or liabilities and classification on the statement of cash flows. The new standard eliminated the requirement to report excess tax benefits and certain tax deficiencies related to share-based payment transactions as additional paid-in capital. It also removes the requirement to delay recognition of a windfall tax benefit until it reduces current taxes payable. Under the new guidance, the benefit will be recorded when it arises, subject to normal valuation allowance considerations. The Company adopted this new accounting standard beginning in the first quarter of fiscal 2017 using a modified-retrospective transition method and recorded a cumulative effect of $4.6 million of additional gross deferred tax asset associated with shared-based payment and an offsetting valuation allowance of the same amount, therefore resulting in no net impact to the Company’s beginning retained earnings. In October 2016, the FASB issued an accounting standard update which requires companies to recognize the income tax consequences of all intra-entity sales of assets other than inventory when they occur. As a result, a reporting entity would recognize the tax expense from the sale of the asset in the seller’s tax jurisdiction when the transfer occurs, even though the pre-tax effects of that transaction are eliminated in consolidation. Any deferred tax asset that arises in the buyer’s jurisdiction would also be recognized at the time of the transfer. The Company early adopted this accounting standard update during the first quarter of fiscal 2017 on a modified retrospective approach and recorded a cumulative-effect adjustment of $1.4 million to the retained earnings as of January 1, 2017 (which reduced the accumulated deficit). Correspondingly, in the first quarter of fiscal 2017, the Company recognized an additional $1.1 million of net deferred tax assets, after netting with $2.1 million of valuation allowance, and write off the remaining $0.3 million of unamortized tax expenses deferred under the previous guidance to provision for income taxes in the first quarter of fiscal 2017. |
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Segment Information | Operating segments are defined as components of an enterprise that engage in business activities for which separate financial information is available and evaluated by the Company’s Chief Operating Decision Maker ( the “CODM”), which for Harmonic is its Chief Executive Officer, in deciding how to allocate resources and assess performance. Based on our internal reporting structure, the Company consists of two operating segments: Video and Cable Edge. The operating segments were determined based on the nature of the products offered. The Video segment sells video processing and production and playout solutions and services worldwide to broadcast and media companies, streaming new media companies, cable operators, and satellite and telecommunications (telco) Pay-TV service providers. The Cable Edge segment sells cable edge solutions and related services to cable operators globally. On February 29, 2016, the Company completed its acquisition of 100% of the outstanding equity of TVN and assigned TVN to its Video operating segment. The Company does not allocate amortization of intangibles, stock-based compensation, restructuring and related charges, TVN acquisition- and integration-related costs, and certain other non-recurring charges to the operating income for each segment because management does not include this information in the measurement of the performance of the operating segments. A measure of assets by segment is not applicable as segment assets are not included in the discrete financial information provided to the CODM. |
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Warranties and Indemnification | The Company accrues for estimated warranty costs at the time of product shipment. Management periodically reviews the estimated fair value of its warranty liability and records adjustments based on the terms of warranties provided to customers, historical and anticipated warranty claims experience, and estimates of the timing and cost of warranty claims. Harmonic is obligated to indemnify its officers and the members of its Board of Directors (the “Board”) pursuant to its bylaws and contractual indemnity agreements. Harmonic also indemnifies some of its suppliers and most of its customers for specified intellectual property matters pursuant to certain contractual arrangements, subject to certain limitations. The scope of these indemnities varies, but, in some instances, includes indemnification for damages and expenses (including reasonable attorneys’ fees). |
Business Acquisitions (Tables) |
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Business Acquisition, Pro Forma Information [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Recognized Identified Assets Acquired and Liabilities Assumed | The Company’s allocation of TVN purchase consideration is as follows (in thousands):
(1) See Note 8, “Balance Sheet Components-Prepaid expenses and other current assets” for more information on French R&D tax credit receivables. |
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Schedule of Finite-Lived Intangible Assets Acquired as Part of Business Combination | The following table presents details of the intangible assets acquired through this business combination (in thousands, except years):
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Business Combination Acquisition And Integration Cost | As a result of the TVN acquisition, the Company incurred the acquisition- and integration- related expenses summarized in the table below (in thousands):
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Short-Term Investments (Tables) |
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Cash and Cash Equivalents [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Summary of Short-Term Investments | The following table summarizes the Company’s short-term investments as of December 31, 2016 (in thousands):
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Derivative and Hedging Activities (Tables) |
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Derivative Instruments and Hedging Activities Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Derivative Instruments gain and losses by Statement of Operations locations | The locations and amounts of designated and non-designated derivative instruments’ gains and losses reported in the Company’s Accumulated Other Comprehensive Loss (“AOCI”) and Condensed Consolidated Statements of Operations were as follows (in thousands):
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Schedule of Notional Amounts of Outstanding Derivative Positions | The U.S. dollar equivalents of all outstanding notional amounts of foreign currency forward contracts, including the Euro, British pound, Israeli shekels, Japanese yen and Mexican peso, are summarized as follows (in thousands):
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Schedule of Derivatives Instruments Balance Sheet Location | The locations and fair value amounts of the Company’s derivative instruments reported in its Condensed Consolidated Balance Sheets are as follows (in thousands):
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Changes in fair values of non-designated foreign currency forward contracts | As of September 29, 2017, information related to the offsetting arrangements was as follows (in thousands):
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Fair Value Measurements (Tables) |
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Fair Value Disclosures [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Financial Assets and Liabilities Measured at Fair Value Based on Three-Tier Fair Value Hierarchy | The following table sets forth the fair value of the Company’s financial assets and liabilities measured at fair value on a recurring basis based on the three-tier fair value hierarchy (in thousands):
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Balance Sheet Components (Tables) |
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Accounts Receivable, Net |
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Prepaid, and Other Current Assets |
(1) The Company’s acquired TVN subsidiary in France (the “TVN French Subsidiary”) participates in the French Crédit d’Impôt Recherche (“CIR”) program (the “R&D tax credits”) which allows companies to monetize eligible research expenses. The R&D tax credits can be used to offset against income tax payable to the French government in each of the four years after being incurred, or if not utilized, are recoverable in cash. The amount of R&D tax credits recoverable are subject to audit by the French government. The R&D tax credit receivables at September 29, 2017 were approximately $26.5 million and are expected to be recoverable from 2018 through 2021 with $6.5 million reported under “Prepaid and other Current Assets” and $20.0 million reported under “Other Long-term Assets” on the Company’s Condensed Consolidated Balance Sheets. (2) On September 26, 2016, the Company issued a warrant to purchase shares of its common stock (the “Warrant”) to Comcast pursuant to which Comcast may, subject to certain vesting provisions, purchase up to 7,816,162 shares of the Company’s common stock subject to adjustment in accordance with the terms of the Warrant, for a per share exercise price of $4.76. The portion of the Warrant which vested on September 26, 2016 had a value of approximately $1.6 million and is deemed a customer incentive paid upfront and cumulatively, $0.5 million of this prepaid incentive has been recorded as a reduction to the Company’s net revenues from Comcast. The remaining $1.1 million of this prepaid incentive is reported as an asset under “Prepaid expenses and other current assets” on the Company’s Condensed Consolidated Balance Sheet as of September 29, 2017. The Company considers this asset to be recoverable based on the expectation of Comcast’s future purchases of the pertinent products. (3) The restricted cash balances are held as cash collateral security for certain bank guarantees. These restricted funds are invested in bank deposits and cannot be withdrawn from the Company’s accounts without the prior written consent of the applicable secured party. Additionally, as of September 29, 2017, the Company had approximately $1.2 million of restricted cash for the bank guarantee associated with the TVN French Subsidiary’s office building lease. This amount is reported under “Other Long-term Assets” on the Company’s Condensed Consolidated Balance Sheets. |
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Property, Plant and Equipment |
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Accrued Liabilities |
(1) See Note 10, “Restructuring and related charges-TVN VDP,” for additional information on the Company’s TVN VDP liabilities. (2) See Note 18, “Commitments and Contingencies-Legal Proceedings,” for additional information on the Company’s accrual for the Avid litigation settlement. |
Goodwill and Identified Intangible Assets (Tables) |
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Sep. 29, 2017 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Goodwill and Intangible Assets Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Changes in Carrying Amount of Goodwill | The changes in the carrying amount of goodwill by reportable segments for the nine months ended September 29, 2017 were as follows (in thousands):
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Summary of Goodwill and Identified Intangible Assets | The following is a summary of intangible assets (in thousands):
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Amortization Expense for Identifiable Purchased Intangible Assets | Amortization expense for the identifiable purchased intangible assets for the three and nine months ended September 29, 2017 and September 30, 2016 was allocated as follows (in thousands):
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Estimated Future Amortization Expense of Purchased Intangible Assets | The estimated future amortization expense of purchased intangible assets with definite lives is as follows (in thousands):
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Restructuring and Related Charges (Tables) |
9 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Sep. 29, 2017 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Restructuring Cost and Reserve [Line Items] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Summary of restructuring activities | The following table summarizes the restructuring and related charges (in thousands):
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Harmonic 2016 Restructuring Plan [Member] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Restructuring Cost and Reserve [Line Items] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Restructuring Reserve by Type of Cost | The following table summarizes the activity in the Company’s restructuring accrual related to the Harmonic 2016 Restructuring Plan during the nine months ended September 29, 2017 (in thousands):
(1) See discussion of the TVN VDP above for future estimated payments through 2020. (2) The Company anticipates that the remaining severance and benefits accrual at September 29, 2017 will be fully paid in 2017. (3) The current portion and long-term portion of the restructuring liability are reported under “Accrued and other current liabilities” and “Other non-current liabilities”, respectively, on the Company’s Condensed Consolidated Balance Sheets. |
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Harmonic 2017 Restructuring Plan [Member] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Restructuring Cost and Reserve [Line Items] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Restructuring Reserve by Type of Cost | The following table summarizes the activity in the Company’s restructuring accrual related to the Harmonic 2017 Restructuring Plan during the three months ended September 29, 2017 (in thousands):
(1) The Company anticipates that the remaining severance and benefits accrual at September 29, 2017 will be fully paid within the next twelve months. (2) The current portion and long-term portion of the restructuring liability are reported under “Accrued and other current liabilities” and “Other non-current liabilities”, respectively, on the Company’s Condensed Consolidated Balance Sheets. |
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TVN [Member] | TVN Voluntary Departure Plan [Member] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Restructuring Cost and Reserve [Line Items] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Restructuring estimated future payments by years [Table Text Block] | The table below shows the estimated future payments for TVN VDP as of September 29, 2017 (in thousands):
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Convertible Notes, Other Debts And Capital Leases (Tables) |
9 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Sep. 29, 2017 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Debt Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Carrying Values and Estimated Fair Values of Debt Instruments | The following table presents the components of the Notes as of September 29, 2017 and December 31, 2016 (in thousands, except for years and percentages):
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Convertible Debt Interest | The following table presents interest expense recognized for the Notes (in thousands):
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Schedule of Other Debt and Capital Leases | In connection with the TVN acquisition, the Company assumed a variety of debt and credit facilities in France to satisfy the financing requirements of TVN operations. These arrangements are summarized in the table below (in thousands):
(1) As of September 29, 2017, the Company’s TVN French Subsidiary had an aggregate of $20.2 million of loans due to various financing programs of French government agencies, $17.3 million of which are related to loans backed by R&D tax credit receivables. As of September 29, 2017, the TVN French Subsidiary had an aggregate of $26.5 million of R&D tax credit receivables from the French government from 2018 through 2021. (See Note 8, “Balance Sheet Components-Prepaid expenses and other current assets,” for more information). These tax loans have a fixed rate of 0.6%, plus EURIBOR 1 month + 1.3% and mature between 2018 through 2020. The remaining loans of $2.9 million at September 29, 2017 primarily relate to financial support from French government agencies for R&D innovation projects at minimal interest rates and these loans mature between 2020 through 2023. (2) One of the term loans with a certain financial institution contains annual covenants that require the TVN French Subsidiary to maintain a minimum working capital balance and various other financial covenants and restrictions that limit the French Subsidiary’s ability to incur additional indebtedness. The annual covenant is based on French statutory year-end results and the TVN French Subsidiary failed the 2016 covenant test primarily due to the Company’s plan to integrate TVN’s operations into other subsidiaries for tax planning and logistics purposes. In early 2017, the Company informed the financial institution of the 2016 covenant test results and was told by the financial institution to continue with the original payment schedule. The Company reported the entire loan balance with this financial institution under “Other debts and capital lease obligations, current” in the Condensed Consolidated Balance Sheets. The loan balance was approximately $0.4 million at both September 29, 2017 and December 31, 2016. |
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Schedule of Maturities of Long-term Debt | The table below shows the future minimum repayments of debts and capital lease obligations for TVN as of September 29, 2017 (in thousands):
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Employee Benefit Plans and Stock-based Compensation (Tables) |
9 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Sep. 29, 2017 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Summary of Company's Stock Option and Restricted Stock Unit Activity |
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Summary of Stock Options Outstanding | The following table summarizes information about stock options outstanding as of September 29, 2017 (in thousands, except per share amounts and terms):
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Summary of Restricted Stock Units Outstanding | The following table summarizes information about RSUs and PRSUs outstanding as of September 29, 2017 (in thousands, except term):
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Schedule of Defined Benefit Plans Obligations | The table below shows the components of net periodic benefit costs (in thousands):
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Summary of Stock-Based Compensation Expense | Stock-based Compensation The following table summarizes stock-based compensation expense for all plans (in thousands):
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Valuation Assumptions for Stock Options |
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Schedule of Share-based Payment Award, Employee Stock Purchase Plan, Valuation Assumptions |
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Income Taxes (Tables) |
9 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Sep. 29, 2017 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Income Tax Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of income before income tax | The Company reported the following operating results for the periods presented (in thousands):
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Income (Loss) Per Share (Tables) |
9 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Sep. 29, 2017 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Earnings Per Share [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Numerators and Denominators of Basic and Diluted Net Income (Loss) Per Share Computations | The following table sets forth the computation of the basic and diluted net loss per share (in thousands, except per share amounts):
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Anti-dilutive Securities | The following table sets forth the potential weighted common shares outstanding that were excluded from the computation of basic and diluted net loss per share calculations (in thousands):
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Stockholders' Equity (Tables) |
9 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Sep. 29, 2017 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Equity [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Components of Accumulated Other Comprehensive Loss | The components of AOCI, on an after-tax basis where applicable, were as follows (in thousands):
The effects of amounts reclassified from AOCI into the Condensed Consolidated Statement of Operations were as follows (in thousands):
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Segment Information (Tables) |
9 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Sep. 29, 2017 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Segment Reporting [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Segment Reporting Information, by Segment | The following tables provide summary financial information by reportable segment (in thousands):
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Commitments and Contingencies (Tables) |
9 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Sep. 29, 2017 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Commitments and Contingencies Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Future Minimum Lease Payments Under Non-cancelable Operating Leases | Future minimum lease payments under non-cancelable operating leases as of September 29, 2017 are as follows (in thousands):
|
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Summary of Warranty Accrual Included in Accrued Liabilities | Activity for the Company’s warranty accrual, which is included in accrued and other current liabilities, is summarized below (in thousands):
|
Business Acquisition Narratives (Details) - TVN [Member] - USD ($) $ in Thousands |
3 Months Ended | |
---|---|---|
Dec. 31, 2016 |
Feb. 29, 2016 |
|
Business Acquisition [Line Items] | ||
Business Acquisition, Percentage of Voting Interests Acquired | 100.00% | |
Business Combination, Final Purchase Price | $ 82,512 |
Business Acquisition - Intangible Assets Useful Life (Details) - TVN [Member] $ in Thousands |
12 Months Ended |
---|---|
Dec. 31, 2016
USD ($)
| |
Acquired Finite-Lived Intangible Assets [Line Items] | |
Intangibles | $ 41,100 |
Backlog | |
Acquired Finite-Lived Intangible Assets [Line Items] | |
Acquired Finite-lived Intangible Assets, Weighted Average Useful Life | 6 months |
Intangibles | $ 3,600 |
Developed Technology | |
Acquired Finite-Lived Intangible Assets [Line Items] | |
Acquired Finite-lived Intangible Assets, Weighted Average Useful Life | 4 years |
Intangibles | $ 21,700 |
Customer Relationships | |
Acquired Finite-Lived Intangible Assets [Line Items] | |
Acquired Finite-lived Intangible Assets, Weighted Average Useful Life | 5 years |
Intangibles | $ 15,200 |
Trade Name | |
Acquired Finite-Lived Intangible Assets [Line Items] | |
Acquired Finite-lived Intangible Assets, Weighted Average Useful Life | 4 years |
Intangibles | $ 600 |
Business Acquisition - Acquisition and Integration Expenses (Details) - TVN [Member] - USD ($) $ in Thousands |
3 Months Ended | 9 Months Ended | 12 Months Ended | ||
---|---|---|---|---|---|
Sep. 29, 2017 |
Sep. 30, 2016 |
Sep. 29, 2017 |
Sep. 30, 2016 |
Dec. 31, 2016 |
|
Business Acquisition [Line Items] | |||||
Business Combination, Acquisition Related Costs | $ 534 | $ 3,855 | |||
Business Combination, Integration Related Costs | $ 117 | 4,734 | $ 2,734 | 7,912 | |
Business Combination, Acquisition and Integration Related Expenses | $ 16,900 | ||||
Cost of Goods, Product Line [Member] | |||||
Business Acquisition [Line Items] | |||||
Business Combination, Acquisition Related Costs | 0 | 0 | |||
Business Combination, Integration Related Costs | 0 | 119 | 342 | 610 | |
Research and Development Expense [Member] | |||||
Business Acquisition [Line Items] | |||||
Business Combination, Acquisition Related Costs | 0 | 0 | |||
Business Combination, Integration Related Costs | 0 | 152 | 7 | 702 | |
Selling, General and Administrative Expenses [Member] | |||||
Business Acquisition [Line Items] | |||||
Business Combination, Acquisition Related Costs | 534 | 3,855 | |||
Business Combination, Integration Related Costs | 117 | 4,365 | 2,385 | 6,502 | |
Operating Expense [Member] | |||||
Business Acquisition [Line Items] | |||||
Business Combination, Acquisition Related Costs | 534 | 3,855 | |||
Business Combination, Integration Related Costs | $ 117 | 4,636 | $ 2,734 | 7,814 | |
Investment Income (Expense) [Member] | |||||
Business Acquisition [Line Items] | |||||
Business Combination, Integration Related Costs | $ 98 | $ 98 |
Short-Term Investments - Summary of Short-Term Investments (Detail) - USD ($) $ in Thousands |
Sep. 29, 2017 |
Dec. 31, 2016 |
---|---|---|
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Amortized Cost | $ 6,928 | |
Gross Unrealized Gains | 0 | |
Gross Unrealized Losses | (5) | |
Total short-term investments, Estimated Fair Value | $ 0 | 6,923 |
Corporate bonds [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Amortized Cost | 6,928 | |
Gross Unrealized Gains | 0 | |
Gross Unrealized Losses | (5) | |
Total short-term investments, Estimated Fair Value | $ 6,923 |
Short-Term Investments - Additional Information (Detail) - USD ($) $ in Thousands |
Sep. 29, 2017 |
Dec. 31, 2016 |
---|---|---|
Investments, Debt and Equity Securities [Abstract] | ||
Short-term investments | $ 0 | $ 6,923 |
Cost Method Investments | $ 3,800 | $ 4,400 |
Investments in Other Equity Securities Investments in Other Equity Securities (Details) - USD ($) |
3 Months Ended | 9 Months Ended | 12 Months Ended | ||||||
---|---|---|---|---|---|---|---|---|---|
Sep. 29, 2017 |
Dec. 31, 2016 |
Sep. 30, 2016 |
Apr. 01, 2016 |
Sep. 29, 2017 |
Sep. 30, 2016 |
Dec. 31, 2016 |
Oct. 22, 2014 |
Sep. 02, 2014 |
|
Schedule of Cost-method Investments [Line Items] | |||||||||
Cost Method Investments Carrying Value | $ 3,800,000 | $ 4,400,000 | $ 3,800,000 | $ 4,400,000 | |||||
Research and development | 21,289,000 | $ 24,202,000 | 73,226,000 | $ 74,272,000 | |||||
Prepaid expenses and other current assets | 22,682,000 | 26,319,000 | 22,682,000 | 26,319,000 | |||||
Cost-method Investments, Other than Temporary Impairment | 0 | 1,259,000 | 0 | $ 2,735,000 | |||||
Vislink plc [Member] | |||||||||
Schedule of Cost-method Investments [Line Items] | |||||||||
Noncontrolling Interest, Ownership Percentage by Parent | 3.30% | ||||||||
Cost Method Investments Original Cost | $ 3,300,000 | ||||||||
Cost Method Investments Carrying Value | 200,000 | $ 800,000 | 200,000 | 800,000 | |||||
Other Comprehensive Income (Loss), Unrealized Holding Gain (Loss) on Securities Arising During Period, before Tax | (300,000) | $ 300,000 | |||||||
Cost-method Investments, Other than Temporary Impairment | $ 1,200,000 | $ 1,500,000 | |||||||
Stock Price Increase, Percentage | 67.00% | ||||||||
Pebble Beach Systems [Member] | |||||||||
Schedule of Cost-method Investments [Line Items] | |||||||||
Cost Method Investments Carrying Value | 200,000 | 200,000 | |||||||
Other Comprehensive Income (Loss), Unrealized Holding Gain (Loss) on Securities Arising During Period, before Tax | (300,000) | ||||||||
Variable Interest Entity, Reporting Entity Involvement, Maximum Loss Exposure, Amount | $ 500,000 | 500,000 | |||||||
Stock Price Decrease, Percentage | 82.00% | ||||||||
Variable Interest Entity, Not Primary Beneficiary [Member] | EDC [Member] | |||||||||
Schedule of Cost-method Investments [Line Items] | |||||||||
Noncontrolling Interest, Ownership Percentage by Parent | 18.40% | ||||||||
Cost Method Investments Original Cost | $ 3,500,000 | ||||||||
Cost-method Investments, Other than Temporary Impairment | 0 | ||||||||
Other Comprehensive Income (Loss) [Member] | Pebble Beach Systems [Member] | |||||||||
Schedule of Cost-method Investments [Line Items] | |||||||||
Cost-method Investments, Realized Losses, Excluding Other than Temporary Impairments | 600,000 | ||||||||
Cost-method Investments [Member] | Variable Interest Entity, Not Primary Beneficiary [Member] | EDC [Member] | |||||||||
Schedule of Cost-method Investments [Line Items] | |||||||||
Variable Interest Entity, Reporting Entity Involvement, Maximum Loss Exposure, Amount | $ 3,600,000 | 3,600,000 | |||||||
Other Expense [Member] | Variable Interest Entity, Not Primary Beneficiary [Member] | EDC [Member] | |||||||||
Schedule of Cost-method Investments [Line Items] | |||||||||
Variable Interest Entity, Reporting Entity Involvement, Maximum Loss Exposure, Amount | $ 100,000 | $ 100,000 |
Derivatives and Hedging Activities - Additional Information (Details) $ in Millions |
9 Months Ended |
---|---|
Sep. 29, 2017
USD ($)
| |
Not Designated as Hedging Instrument [Member] | Forward Contracts [Member] | |
Derivative [Line Items] | |
Derivative, Term of Contract | 3 months |
Israel [Member] | |
Derivative [Line Items] | |
Compensating Balance, Amount | $ 2.5 |
Derivative and Hedging Activities gain losses in Statement of Operations (Details) - USD ($) $ in Thousands |
3 Months Ended | 9 Months Ended | ||
---|---|---|---|---|
Sep. 29, 2017 |
Sep. 30, 2016 |
Sep. 29, 2017 |
Sep. 30, 2016 |
|
Derivatives, Fair Value [Line Items] | ||||
Derivative Instruments, Loss Reclassified from Accumulated OCI into Income, Effective Portion | $ 0 | $ 0 | $ (53) | |
Derivative Instruments, Gain Reclassified from Accumulated OCI into Income, Effective Portion | $ 47 | |||
Other Comprehensive Income (Loss) [Member] | ||||
Derivatives, Fair Value [Line Items] | ||||
Derivative Instruments, Gain Recognized in Other Comprehensive Income (Loss), Effective Portion | 0 | 121 | 0 | 279 |
Cost of Sales [Member] | ||||
Derivatives, Fair Value [Line Items] | ||||
Derivative Instruments, Loss Reclassified from Accumulated OCI into Income, Effective Portion | 0 | 0 | (7) | |
Derivative Instruments, Gain Reclassified from Accumulated OCI into Income, Effective Portion | 6 | |||
Operating Expense [Member] | ||||
Derivatives, Fair Value [Line Items] | ||||
Derivative Instruments, Loss Reclassified from Accumulated OCI into Income, Effective Portion | 0 | 0 | (46) | |
Derivative Instruments, Gain Reclassified from Accumulated OCI into Income, Effective Portion | 41 | |||
Other Nonoperating Income (Expense) [Member] | ||||
Derivatives, Fair Value [Line Items] | ||||
Losses recognized in income on derivatives (ineffectiveness portion and amount excluded from effectiveness testing) | 0 | (8) | 0 | (57) |
Other Nonoperating Income (Expense) [Member] | Not Designated as Hedging Instrument [Member] | ||||
Derivatives, Fair Value [Line Items] | ||||
Gains (losses) recognized in income | $ 119 | $ (162) | $ (66) | $ (496) |
Derivatives and Hedging Activities Notional Amounts (Details) - Foreign Exchange Forward [Member] - Not Designated as Hedging Instrument [Member] - Fair Value Hedging [Member] - USD ($) $ in Thousands |
Sep. 29, 2017 |
Dec. 31, 2016 |
---|---|---|
Long [Member] | ||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||
Derivative Asset, Notional Amount | $ 12,925 | $ 4,056 |
Short [Member] | ||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||
Derivative Liability, Notional Amount | $ 1,501 | $ 11,157 |
Derivatives and Hedging Activities Assets Liabilities Balance Sheet Location (Details) - Foreign Exchange Contract [Member] - USD ($) $ in Thousands |
Sep. 29, 2017 |
Dec. 31, 2016 |
---|---|---|
Derivatives, Fair Value [Line Items] | ||
Derivative Asset, Current | $ 13 | $ 54 |
Derivative Liability, Current | 45 | 40 |
Not Designated as Hedging Instrument [Member] | Prepaid Expenses and Other Current Assets [Member] | ||
Derivatives, Fair Value [Line Items] | ||
Derivative Asset, Current | 13 | 54 |
Not Designated as Hedging Instrument [Member] | Accrued Liabilities [Member] | ||
Derivatives, Fair Value [Line Items] | ||
Derivative Liability, Current | $ 45 | $ 40 |
Derivatives and Hedging Activities Asset and Liability Offset (Details) $ in Thousands |
Sep. 29, 2017
USD ($)
|
---|---|
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Derivative Asset, Gross Amounts of Derivatives | $ 13 |
Derivative Assets, Gross Amounts of Derivatives Offset in the Condensed Consolidated Balance Sheets | 0 |
Net Amounts of Derivatives Assets Presented in the Condensed Consolidated Balance Sheets | 13 |
Derivative Assets, Gross Amounts of Derivatives Not Offset in the Condensed Consolidated Balance Sheets, Financial Instrument | (6) |
Derivative Assets, Gross Amounts of Derivatives Not Offset in the Condensed Consolidated Balance Sheets,Cash Collateral Pledged | 0 |
Derivative Assets, Net Amount | 7 |
Derivative Liabilities, Gross Amounts of Derivatives | 45 |
Derivative Liabilities, Gross Amounts of Derivatives Offset in the Condensed Consolidated Balance Sheets | 0 |
Net Amounts of Derivatives Liability Presented in the Condensed Consolidated Balance Sheets | 45 |
Derivative Liabilities, Gross Amounts of Derivatives Not Offset in the Condensed Consolidated Balance Sheets, Financial Instrument | (6) |
Derivative Liabilities, Gross Amounts of Derivatives Not Offset in the Condensed Consolidated Balance Sheets, Cash Collateral Pledged | 0 |
Derivative Liabilities, Net Amount | $ 39 |
Fair Value Measurements - Narratives (Details) - USD ($) $ in Thousands |
Sep. 29, 2017 |
Dec. 31, 2016 |
---|---|---|
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Debt and Capital Lease Obligations | $ 22,873 | $ 21,190 |
Defined Benefit Plan, Benefit Obligation | 5,100 | 4,300 |
Assets, Fair Value Disclosure, Nonrecurring | 0 | |
Liabilities, Fair Value Disclosure, Nonrecurring | 0 | |
Level 2 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Convertible Debt, Fair Value Disclosures | 114,200 | 143,500 |
Debt and Capital Lease Obligations | 22,900 | |
Fair Value, Measurements, Recurring [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total liabilities measured and recorded at fair value | 6,049 | 9,690 |
Fair Value, Measurements, Recurring [Member] | Level 2 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total liabilities measured and recorded at fair value | 45 | 40 |
Fair Value, Measurements, Recurring [Member] | Level 3 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total liabilities measured and recorded at fair value | $ 6,004 | $ 9,650 |
Fair Value Measurements - Financial Assets and Liabilities Measured at Fair Value Based on Three-Tier Fair Value Hierarchy (Detail) - USD ($) $ in Thousands |
Sep. 29, 2017 |
Dec. 31, 2016 |
---|---|---|
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Postemployment Benefits Liability, Current | $ 3,519 | $ 6,597 |
Postemployment Benefits Liability, Noncurrent | 2,485 | 3,053 |
Fair Value, Measurements, Recurring [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total assets measured and recorded at fair value | 459 | 16,087 |
Total liabilities measured and recorded at fair value | 6,049 | 9,690 |
Fair Value, Measurements, Recurring [Member] | Cost-method Investments [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total assets measured and recorded at fair value | 200 | 809 |
Money market funds [Member] | Fair Value, Measurements, Recurring [Member] | Cash equivalents [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total assets measured and recorded at fair value | 246 | 8,301 |
Corporate bonds [Member] | Fair Value, Measurements, Recurring [Member] | Short-term Investments [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total assets measured and recorded at fair value | 6,923 | |
Foreign exchange forward contracts [Member] | Fair Value, Measurements, Recurring [Member] | Prepaid Expenses and Other Current Assets [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total assets measured and recorded at fair value | 13 | 54 |
Foreign exchange forward contracts [Member] | Fair Value, Measurements, Recurring [Member] | Accrued Liabilities [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total liabilities measured and recorded at fair value | 45 | 40 |
Level 1 [Member] | Fair Value, Measurements, Recurring [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total assets measured and recorded at fair value | 446 | 9,110 |
Total liabilities measured and recorded at fair value | 0 | 0 |
Level 1 [Member] | Fair Value, Measurements, Recurring [Member] | Cost-method Investments [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total assets measured and recorded at fair value | 200 | 809 |
Level 1 [Member] | Money market funds [Member] | Fair Value, Measurements, Recurring [Member] | Cash equivalents [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total assets measured and recorded at fair value | 246 | 8,301 |
Level 1 [Member] | Corporate bonds [Member] | Fair Value, Measurements, Recurring [Member] | Short-term Investments [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total assets measured and recorded at fair value | 0 | |
Level 1 [Member] | Foreign exchange forward contracts [Member] | Fair Value, Measurements, Recurring [Member] | Prepaid Expenses and Other Current Assets [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total assets measured and recorded at fair value | 0 | 0 |
Level 1 [Member] | Foreign exchange forward contracts [Member] | Fair Value, Measurements, Recurring [Member] | Accrued Liabilities [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total liabilities measured and recorded at fair value | 0 | 0 |
Level 2 [Member] | Fair Value, Measurements, Recurring [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total assets measured and recorded at fair value | 13 | 6,977 |
Total liabilities measured and recorded at fair value | 45 | 40 |
Level 2 [Member] | Fair Value, Measurements, Recurring [Member] | Cost-method Investments [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total assets measured and recorded at fair value | 0 | 0 |
Level 2 [Member] | Money market funds [Member] | Fair Value, Measurements, Recurring [Member] | Cash equivalents [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total assets measured and recorded at fair value | 0 | 0 |
Level 2 [Member] | Corporate bonds [Member] | Fair Value, Measurements, Recurring [Member] | Short-term Investments [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total assets measured and recorded at fair value | 6,923 | |
Level 2 [Member] | Foreign exchange forward contracts [Member] | Fair Value, Measurements, Recurring [Member] | Prepaid Expenses and Other Current Assets [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total assets measured and recorded at fair value | 13 | 54 |
Level 2 [Member] | Foreign exchange forward contracts [Member] | Fair Value, Measurements, Recurring [Member] | Accrued Liabilities [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total liabilities measured and recorded at fair value | 45 | 40 |
Level 3 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Postemployment Benefits Liability, Current | 3,519 | 6,597 |
Postemployment Benefits Liability, Noncurrent | 2,485 | 3,053 |
Level 3 [Member] | Fair Value, Measurements, Recurring [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total assets measured and recorded at fair value | 0 | 0 |
Total liabilities measured and recorded at fair value | 6,004 | 9,650 |
Level 3 [Member] | Fair Value, Measurements, Recurring [Member] | Cost-method Investments [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total assets measured and recorded at fair value | 0 | 0 |
Level 3 [Member] | Money market funds [Member] | Fair Value, Measurements, Recurring [Member] | Cash equivalents [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total assets measured and recorded at fair value | 0 | 0 |
Level 3 [Member] | Corporate bonds [Member] | Fair Value, Measurements, Recurring [Member] | Short-term Investments [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total assets measured and recorded at fair value | 0 | |
Level 3 [Member] | Foreign exchange forward contracts [Member] | Fair Value, Measurements, Recurring [Member] | Prepaid Expenses and Other Current Assets [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total assets measured and recorded at fair value | 0 | 0 |
Level 3 [Member] | Foreign exchange forward contracts [Member] | Fair Value, Measurements, Recurring [Member] | Accrued Liabilities [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total liabilities measured and recorded at fair value | $ 0 | $ 0 |
Balance Sheet Components - Accounts Receivable, Net, Prepaid Expenses and Other Current Assets, Inventories, Property and Equipment, Net (Detail) - USD ($) $ in Thousands |
Sep. 29, 2017 |
Dec. 31, 2016 |
|||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Accounts receivable, net: | |||||||||||||
Accounts receivable | $ 77,320 | $ 91,596 | |||||||||||
Less: allowances for doubtful accounts, returns and discounts | (5,738) | (4,831) | |||||||||||
Total | 71,582 | 86,765 | |||||||||||
Prepaid expenses and other current assets: | |||||||||||||
Deferred cost of revenue | 6,217 | 6,856 | |||||||||||
French R&D tax credits receivable(1) | [1] | 6,475 | 5,895 | ||||||||||
Prepaid maintenance, royalty, rent, property taxes and value added tax | 4,942 | 5,526 | |||||||||||
Prepaid customer incentive(2) | [2] | 1,124 | 1,162 | ||||||||||
Restricted cash(3) | [3] | 803 | 731 | ||||||||||
Other | 3,121 | 6,149 | |||||||||||
Prepaid Expense and Other Assets, Current | 22,682 | 26,319 | |||||||||||
Inventories: | |||||||||||||
Raw materials | 3,825 | 9,889 | |||||||||||
Work-in-process | 1,290 | 2,318 | |||||||||||
Finished goods | 14,146 | 17,776 | |||||||||||
Service-related spares | 12,493 | 11,210 | |||||||||||
Total inventories, net | 31,754 | 41,193 | |||||||||||
Property, Plant and Equipment [Line Items] | |||||||||||||
Property, Plant and Equipment, Gross | 143,009 | 155,956 | |||||||||||
Accumulated Depreciation, Depletion and Amortization, Property, Plant, and Equipment | (112,278) | (123,792) | |||||||||||
Property, Plant and Equipment, Net | 30,731 | 32,164 | |||||||||||
Accrued Liabilities, Current [Abstract] | |||||||||||||
Accrued employee compensation and related expenses | 14,866 | 19,377 | |||||||||||
Accrued TVN VDP, current (1) | [4] | 3,519 | 6,597 | ||||||||||
Accrued warranty | 4,341 | 4,862 | |||||||||||
Customer deposits | 4,526 | 4,537 | |||||||||||
Contingent inventory reserves | 3,840 | 2,210 | |||||||||||
Accrued Avid litigation settlement, current (2) | [5] | 2,500 | |||||||||||
Accrued royalty payments | 2,325 | 1,912 | |||||||||||
Others | 16,911 | 15,655 | |||||||||||
Accrued Liabilities, Current | 52,828 | 55,150 | |||||||||||
Machinery and Equipment [Member] | |||||||||||||
Property, Plant and Equipment [Line Items] | |||||||||||||
Property, Plant and Equipment, Gross | 86,971 | 97,989 | |||||||||||
Capitalized software [Member] | |||||||||||||
Property, Plant and Equipment [Line Items] | |||||||||||||
Property, Plant and Equipment, Gross | 34,496 | 34,519 | |||||||||||
Leasehold Improvements [Member] | |||||||||||||
Property, Plant and Equipment [Line Items] | |||||||||||||
Property, Plant and Equipment, Gross | 14,745 | 14,455 | |||||||||||
Furniture and Fixtures [Member] | |||||||||||||
Property, Plant and Equipment [Line Items] | |||||||||||||
Property, Plant and Equipment, Gross | $ 6,797 | $ 8,993 | |||||||||||
|
Balance Sheet Components Additional Information (Details) - USD ($) $ / shares in Units, $ in Thousands |
Sep. 29, 2017 |
Dec. 31, 2016 |
Sep. 26, 2016 |
|||||
---|---|---|---|---|---|---|---|---|
Business Acquisition, Contingent Consideration [Line Items] | ||||||||
Income Taxes Receivable, Current | [1] | $ 6,475 | $ 5,895 | |||||
Class of Warrant or Right, Number of Securities Called by Warrants or Rights | 7,816,162 | |||||||
Class of Warrant or Right, Exercise Price of Warrants or Rights | $ 4.76 | |||||||
Prepaid Expenses and Other Current Assets [Member] | ||||||||
Business Acquisition, Contingent Consideration [Line Items] | ||||||||
Prepaid Warrants Incentive | 1,100 | |||||||
Property Lease Guarantee [Member] | Other Noncurrent Assets [Member] | TVN [Member] | ||||||||
Business Acquisition, Contingent Consideration [Line Items] | ||||||||
Restricted Cash and Cash Equivalents | 1,200 | |||||||
Research Tax Credit Carryforward [Member] | TVN [Member] | ||||||||
Business Acquisition, Contingent Consideration [Line Items] | ||||||||
Income Taxes Receivable, Noncurrent | [2] | 26,500 | ||||||
Research Tax Credit Carryforward [Member] | Prepaid Expenses and Other Current Assets [Member] | TVN [Member] | ||||||||
Business Acquisition, Contingent Consideration [Line Items] | ||||||||
Income Taxes Receivable, Current | [2] | 6,500 | ||||||
Research Tax Credit Carryforward [Member] | Other Noncurrent Assets [Member] | TVN [Member] | ||||||||
Business Acquisition, Contingent Consideration [Line Items] | ||||||||
Income Taxes Receivable, Current | [2] | 20,000 | ||||||
Comcast Product Supply Agreement [Member] | ||||||||
Business Acquisition, Contingent Consideration [Line Items] | ||||||||
Warrants and Rights Outstanding | 1,600 | $ 1,600 | ||||||
Sales Revenue, Goods, Net [Member] | Comcast Product Supply Agreement [Member] | ||||||||
Business Acquisition, Contingent Consideration [Line Items] | ||||||||
Warrants and Rights Outstanding | $ 500 | |||||||
|
Goodwill and Intangible Assets - Narratives (Details) $ in Thousands |
9 Months Ended | |||
---|---|---|---|---|
Sep. 29, 2017
USD ($)
ReportingUnit
|
Sep. 30, 2016
USD ($)
|
Dec. 31, 2016
USD ($)
|
Oct. 31, 2016 |
|
Goodwill [Line Items] | ||||
Number of Reporting Units | ReportingUnit | 2 | |||
Goodwill | $ 241,932 | $ 237,279 | ||
Goodwill, Impairment Loss | 0 | $ 0 | ||
Video [Member] | ||||
Goodwill [Line Items] | ||||
Goodwill | 181,122 | 176,519 | ||
Reporting Unit, Percentage of Fair Value in Excess of Carrying Amount | 67.00% | |||
Cable Edge [Member] | ||||
Goodwill [Line Items] | ||||
Goodwill | $ 60,810 | 60,760 | ||
Reporting Unit, Percentage of Fair Value in Excess of Carrying Amount | 123.00% | |||
TVN [Member] | ||||
Goodwill [Line Items] | ||||
Goodwill | $ 41,670 |
Goodwill and Identified Intangible Assets - Changes in Carrying Amount of Goodwill (Detail) $ in Thousands |
9 Months Ended |
---|---|
Sep. 29, 2017
USD ($)
| |
Goodwill [Line Items] | |
Balance at beginning of period | $ 237,279 |
Foreign currency translation adjustment | 4,653 |
Balance at end of period | 241,932 |
Video [Member] | |
Goodwill [Line Items] | |
Balance at beginning of period | 176,519 |
Foreign currency translation adjustment | 4,603 |
Balance at end of period | 181,122 |
Cable Edge [Member] | |
Goodwill [Line Items] | |
Balance at beginning of period | 60,760 |
Foreign currency translation adjustment | 50 |
Balance at end of period | $ 60,810 |
Goodwill and Identified Intangible Assets - Summary of Goodwill and Identified Intangible Assets (Detail) - USD ($) $ in Thousands |
9 Months Ended | |
---|---|---|
Sep. 29, 2017 |
Dec. 31, 2016 |
|
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | $ 85,607 | $ 85,175 |
Accumulated Amortization | (62,291) | (55,944) |
Total future amortization expense | $ 23,316 | 29,231 |
Developed Technology | ||
Finite-Lived Intangible Assets [Line Items] | ||
Useful Life | 2 years 4 months 24 days | |
Gross Carrying Amount | $ 31,707 | 31,707 |
Accumulated Amortization | (19,101) | (15,216) |
Total future amortization expense | $ 12,606 | 16,491 |
Customer relationships/contracts [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Useful Life | 3 years 4 months 24 days | |
Gross Carrying Amount | $ 44,748 | 44,384 |
Accumulated Amortization | (34,425) | (32,098) |
Total future amortization expense | $ 10,323 | 12,286 |
Trademarks and Trade Names [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Useful Life | 2 years 4 months 24 days | |
Gross Carrying Amount | $ 641 | 573 |
Accumulated Amortization | (254) | (119) |
Total future amortization expense | 387 | 454 |
Maintenance agreements and related relationships [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | 5,500 | 5,500 |
Accumulated Amortization | (5,500) | (5,500) |
Total future amortization expense | 0 | 0 |
Backlog | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | 3,011 | 3,011 |
Accumulated Amortization | (3,011) | (3,011) |
Total future amortization expense | $ 0 | $ 0 |
Goodwill and Identified Intangible Assets - Amortization Expense for Identifiable Purchased Intangible Assets (Detail) - USD ($) $ in Thousands |
3 Months Ended | 9 Months Ended | ||
---|---|---|---|---|
Sep. 29, 2017 |
Sep. 30, 2016 |
Sep. 29, 2017 |
Sep. 30, 2016 |
|
Acquired Finite-Lived Intangible Assets [Line Items] | ||||
Included in cost of revenue | $ 1,295 | $ 1,380 | $ 3,885 | $ 3,105 |
Included in operating expenses | 793 | 3,009 | 2,347 | 9,606 |
Total amortization expense | $ 2,088 | $ 4,389 | $ 6,232 | $ 12,711 |
Goodwill and Identified Intangible Assets - Estimated Future Amortization Expense of Purchased Intangible Assets (Detail) - USD ($) $ in Thousands |
Sep. 29, 2017 |
Dec. 31, 2016 |
---|---|---|
Acquired Finite-Lived Intangible Assets [Line Items] | ||
2017 (remaining three months) | $ 2,090 | |
2018 | 8,362 | |
2019 | 8,362 | |
2020 | 3,998 | |
2021 | 504 | |
Total future amortization expense | 23,316 | $ 29,231 |
Cost of Sales [Member] | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ||
2017 (remaining three months) | 1,296 | |
2018 | 5,180 | |
2019 | 5,180 | |
2020 | 950 | |
2021 | 0 | |
Total future amortization expense | 12,606 | |
Operating Expense [Member] | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ||
2017 (remaining three months) | 794 | |
2018 | 3,182 | |
2019 | 3,182 | |
2020 | 3,048 | |
2021 | 504 | |
Total future amortization expense | $ 10,710 |
Restructuring and Related Charges Restructuring and Related Charges, COS & OPEX (Details) - USD ($) $ in Thousands |
3 Months Ended | 9 Months Ended | ||
---|---|---|---|---|
Sep. 29, 2017 |
Sep. 30, 2016 |
Sep. 29, 2017 |
Sep. 30, 2016 |
|
Restructuring and Related Activities [Abstract] | ||||
Production Related Impairments or Charges | $ 549 | $ 1,335 | ||
Production Related Impairment Cost Recovery | $ (1) | $ (24) | ||
Restructuring and related charges | 2,028 | (27) | 4,084 | 4,488 |
Restructuring Charges | $ 2,577 | $ (28) | $ 5,419 | $ 4,464 |
Restructuring and Related Charges - Additional Information (Detail) $ in Thousands |
1 Months Ended | 3 Months Ended | 6 Months Ended | 9 Months Ended | 12 Months Ended | 21 Months Ended | |||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Jan. 31, 2016
USD ($)
|
Sep. 29, 2017
USD ($)
|
Dec. 31, 2016
USD ($)
Employees
|
Sep. 30, 2016
USD ($)
|
Jun. 30, 2017
Employee
|
Sep. 29, 2017
USD ($)
|
Sep. 30, 2016
USD ($)
|
Dec. 31, 2016
USD ($)
Employees
|
Sep. 29, 2017
USD ($)
|
Jan. 04, 2016
USD ($)
|
||||||
Restructuring Cost and Reserve [Line Items] | |||||||||||||||
Adjustments to restructuring provisions | $ 2,028 | $ (27) | $ 4,084 | $ 4,488 | |||||||||||
Harmonic 2017 Restructuring Plan [Member] | |||||||||||||||
Restructuring Cost and Reserve [Line Items] | |||||||||||||||
Charges for 2016 Harmonic Restructuring Plan | 2,435 | ||||||||||||||
Harmonic 2016 Restructuring Plan [Member] | |||||||||||||||
Restructuring Cost and Reserve [Line Items] | |||||||||||||||
Restructuring and Related Cost, Incurred Cost | 100 | 2,900 | $ 20,000 | ||||||||||||
Charges for 2016 Harmonic Restructuring Plan | 2,991 | ||||||||||||||
Adjustments to restructuring provisions | (7) | ||||||||||||||
Facility Closing [Member] | Harmonic 2017 Restructuring Plan [Member] | |||||||||||||||
Restructuring Cost and Reserve [Line Items] | |||||||||||||||
Charges for 2016 Harmonic Restructuring Plan | 318 | ||||||||||||||
Facility Closing [Member] | Harmonic 2016 Restructuring Plan [Member] | |||||||||||||||
Restructuring Cost and Reserve [Line Items] | |||||||||||||||
Restructuring and Related Cost, Incurred Cost | 2,200 | ||||||||||||||
Charges for 2016 Harmonic Restructuring Plan | 73 | ||||||||||||||
Adjustments to restructuring provisions | 0 | ||||||||||||||
Employee Severance And Benefit Arrangements [Member] | Harmonic 2016 Restructuring Plan [Member] | |||||||||||||||
Restructuring Cost and Reserve [Line Items] | |||||||||||||||
Restructuring and Related Cost, Incurred Cost | $ 17,800 | ||||||||||||||
Number of positions eliminated | Employees | 118 | ||||||||||||||
Employee Severance [Member] | Harmonic 2017 Restructuring Plan [Member] | |||||||||||||||
Restructuring Cost and Reserve [Line Items] | |||||||||||||||
Charges for 2016 Harmonic Restructuring Plan | 2,117 | ||||||||||||||
Employee Severance [Member] | Harmonic 2016 Restructuring Plan [Member] | |||||||||||||||
Restructuring Cost and Reserve [Line Items] | |||||||||||||||
Charges for 2016 Harmonic Restructuring Plan | [1] | 1,137 | |||||||||||||
Adjustments to restructuring provisions | [1] | (7) | |||||||||||||
TVN Voluntary Departure Plan [Member] | Harmonic 2016 Restructuring Plan [Member] | |||||||||||||||
Restructuring Cost and Reserve [Line Items] | |||||||||||||||
Charges for 2016 Harmonic Restructuring Plan | [2] | 1,781 | |||||||||||||
Adjustments to restructuring provisions | [2] | 0 | |||||||||||||
TVN [Member] | |||||||||||||||
Restructuring Cost and Reserve [Line Items] | |||||||||||||||
Defined Benefit Plan, Net Periodic Benefit Cost (Credit), Gain (Loss) Due to Curtailment | $ 2,000 | ||||||||||||||
Business Combination, Acquisition and Integration Related Expenses | 16,900 | ||||||||||||||
Business Combination, Integration Related Costs | 117 | $ 4,734 | 2,734 | $ 7,912 | |||||||||||
Number of employees applied for VDP | Employees | 83 | ||||||||||||||
Voluntary Departure Plan Anticipated Cost | $ 15,300 | ||||||||||||||
Voluntary Departure Plan Benefit Obligation Term | 4 years | ||||||||||||||
Number of employees required to work beyond minimum statutory notice period under VDP | Employees | 11 | ||||||||||||||
Accrued Voluntary Departure Plan, Current | $ 14,800 | $ 14,800 | |||||||||||||
TVN [Member] | Employee Severance And Benefit Arrangements [Member] | Harmonic 2016 Restructuring Plan [Member] | |||||||||||||||
Restructuring Cost and Reserve [Line Items] | |||||||||||||||
Number of positions eliminated | 21 | 83 | |||||||||||||
TVN [Member] | Employee Severance [Member] | Harmonic 2016 Restructuring Plan [Member] | |||||||||||||||
Restructuring Cost and Reserve [Line Items] | |||||||||||||||
Postemployment Benefits, Period Expense | 1,800 | ||||||||||||||
Charges for 2016 Harmonic Restructuring Plan | 1,100 | ||||||||||||||
TVN [Member] | TVN Voluntary Departure Plan [Member] | |||||||||||||||
Restructuring Cost and Reserve [Line Items] | |||||||||||||||
Charges for 2016 Harmonic Restructuring Plan | 1,800 | $ 13,100 | |||||||||||||
Defined Benefit Plan, Benefit Obligation, Benefits Paid | 6,200 | $ 3,500 | $ 9,700 | ||||||||||||
Postemployment Benefits Liability | $ 6,000 | $ 6,000 | $ 6,000 | ||||||||||||
San Jose CA Excess Facility [Member] | Facility Closing [Member] | Harmonic 2016 Restructuring Plan [Member] | |||||||||||||||
Restructuring Cost and Reserve [Line Items] | |||||||||||||||
Charges for 2016 Harmonic Restructuring Plan | $ 1,400 | ||||||||||||||
Fair Value of Excess Facility Restructuring | $ 2,500 | ||||||||||||||
Deferred Rent Credit | $ 1,100 | ||||||||||||||
Adjustments to restructuring provisions | $ 600 | ||||||||||||||
|
Restructuring and Related Charges Restructuring and Related Charges - Estimated Future Payments (Details) - TVN [Member] - TVN Voluntary Departure Plan [Member] - Harmonic 2016 Restructuring Plan [Member] $ in Thousands |
Sep. 29, 2017
USD ($)
|
---|---|
Restructuring Cost and Reserve [Line Items] | |
2017 (remaining three months) | $ 1,145 |
2018 | 2,937 |
2019 | 1,379 |
2020 | 543 |
Total | $ 6,004 |
Restructuring and Related Charges - 2016 Activities in Restructuring Accrual (Detail) - USD ($) $ in Thousands |
3 Months Ended | 9 Months Ended | |||||||||
---|---|---|---|---|---|---|---|---|---|---|---|
Sep. 29, 2017 |
Sep. 30, 2016 |
Sep. 29, 2017 |
Sep. 30, 2016 |
||||||||
Restructuring Reserve [Roll Forward] | |||||||||||
Restructuring and related charges | $ 2,028 | $ (27) | $ 4,084 | $ 4,488 | |||||||
Harmonic 2016 Restructuring Plan [Member] | |||||||||||
Restructuring Reserve [Roll Forward] | |||||||||||
Beginning Balance | 13,544 | ||||||||||
Restructuring charges | 2,991 | ||||||||||
Restructuring and related charges | (7) | ||||||||||
Cash payments | (9,665) | ||||||||||
Foreign exchange gain (loss) | 841 | ||||||||||
Ending Balance | 7,704 | 13,544 | |||||||||
Restructuring Reserve, Current | [1] | (4,422) | |||||||||
Restructuring Reserve, Noncurrent | [1] | 3,282 | |||||||||
Harmonic 2016 Restructuring Plan [Member] | Facility Closing [Member] | |||||||||||
Restructuring Reserve [Roll Forward] | |||||||||||
Beginning Balance | 2,375 | ||||||||||
Restructuring charges | 73 | ||||||||||
Restructuring and related charges | 0 | ||||||||||
Cash payments | (921) | ||||||||||
Ending Balance | 1,527 | 2,375 | |||||||||
Restructuring Reserve, Current | [1] | (730) | |||||||||
Restructuring Reserve, Noncurrent | [1] | 797 | |||||||||
Harmonic 2016 Restructuring Plan [Member] | TVN Voluntary Departure Plan [Member] | |||||||||||
Restructuring Reserve [Roll Forward] | |||||||||||
Beginning Balance | [2] | 9,650 | |||||||||
Restructuring charges | [2] | 1,781 | |||||||||
Restructuring and related charges | [2] | 0 | |||||||||
Cash payments | [2] | (6,232) | |||||||||
Foreign exchange gain (loss) | [2] | 805 | |||||||||
Ending Balance | [2] | 6,004 | 9,650 | ||||||||
Restructuring Reserve, Current | [1],[2] | (3,519) | |||||||||
Restructuring Reserve, Noncurrent | [1],[2] | 2,485 | |||||||||
Harmonic 2016 Restructuring Plan [Member] | Employee Severance [Member] | |||||||||||
Restructuring Reserve [Roll Forward] | |||||||||||
Beginning Balance | [3] | 1,519 | |||||||||
Restructuring charges | [3] | 1,137 | |||||||||
Restructuring and related charges | [3] | (7) | |||||||||
Cash payments | [3] | (2,512) | |||||||||
Foreign exchange gain (loss) | [3] | 36 | |||||||||
Ending Balance | [3] | 173 | $ 1,519 | ||||||||
Restructuring Reserve, Current | [3] | (173) | |||||||||
Restructuring Reserve, Noncurrent | [1],[3] | $ 0 | |||||||||
|
Restructuring and Related Charges - 2017 Activities in Restructuring Accrual (Details) - Harmonic 2017 Restructuring Plan [Member] $ in Thousands |
3 Months Ended | |||||
---|---|---|---|---|---|---|
Sep. 29, 2017
USD ($)
| ||||||
Restructuring Cost and Reserve [Line Items] | ||||||
Restructuring charges | $ 2,435 | |||||
Payments for Restructuring | (1,638) | |||||
Restructuring Reserve, Settled without Cash | 58 | |||||
Ending Balance | 855 | |||||
Restructuring Reserve, Current | (684) | [1] | ||||
Restructuring Reserve, Noncurrent | 171 | [2] | ||||
Facility Closing [Member] | ||||||
Restructuring Cost and Reserve [Line Items] | ||||||
Restructuring charges | 318 | |||||
Payments for Restructuring | (45) | |||||
Restructuring Reserve, Settled without Cash | 58 | |||||
Ending Balance | 331 | |||||
Restructuring Reserve, Current | (160) | [1] | ||||
Restructuring Reserve, Noncurrent | 171 | [2] | ||||
Employee Severance [Member] | ||||||
Restructuring Cost and Reserve [Line Items] | ||||||
Restructuring charges | 2,117 | |||||
Payments for Restructuring | (1,593) | |||||
Restructuring Reserve, Settled without Cash | 0 | |||||
Ending Balance | 524 | |||||
Restructuring Reserve, Current | (524) | [1] | ||||
Restructuring Reserve, Noncurrent | $ 0 | [2] | ||||
|
Convertible Notes, Other Debts And Capital Leases - Additional Information (Detail) $ / shares in Units, shares in Millions |
3 Months Ended | 9 Months Ended | 12 Months Ended | |||||||
---|---|---|---|---|---|---|---|---|---|---|
Dec. 14, 2015
shares
|
Sep. 29, 2017
USD ($)
$ / shares
|
Sep. 29, 2017
USD ($)
$ / shares
|
Dec. 31, 2015
USD ($)
day
$ / shares
|
Dec. 31, 2016
USD ($)
|
||||||
Debt Instrument [Line Items] | ||||||||||
Debt Instrument, Interest Rate, Stated Percentage | 4.00% | |||||||||
Debt Instrument, Face Amount | $ 128,250,000 | $ 128,250,000 | $ 128,250,000 | $ 128,250,000 | ||||||
Debt Instrument, Convertible, Conversion Ratio | 173.9978 | |||||||||
Debt Conversion, Converted Instrument, Amount | $ 1,000 | |||||||||
Debt Instrument, Convertible, Conversion Price | $ / shares | $ 5.75 | $ 5.75 | $ 5.75 | |||||||
Debt Issuance Cost, Gross, Noncurrent | $ 4,100,000 | |||||||||
Percentage Of Principal Amount Of Convertible Notes Is Equal To Repurchase Price | 100.00% | |||||||||
Debt Instrument Convertible Allocated Amount of Equity Component | $ 26,925,000 | $ 26,925,000 | $ 26,925,000 | 26,925,000 | ||||||
Debt Instrument, Unamortized Discount (Premium), Net | 4,100,000 | |||||||||
Unamortized Debt Issuance Expense | 2,252,000 | 2,252,000 | 3,200,000 | 2,689,000 | ||||||
Debt Instrument Convertible Equity Component Issuance Cost | 863,000 | 863,000 | $ 863,000 | 863,000 | ||||||
Financing from French government agencies related to various government incentive programs (1) | [1] | 20,205,000 | 20,205,000 | 17,930,000 | ||||||
Term loans (2) | [2] | 1,334,000 | 1,334,000 | 1,400,000 | ||||||
Stock price greater or equal 130 percent of Note Conversion Price [Member] | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Debt Instrument, Convertible, Threshold Trading Days | day | 20 | |||||||||
Debt Instrument, Convertible, Threshold Consecutive Trading Days | day | 30 | |||||||||
Debt Instrument, Convertible, Threshold Percentage of Stock Price Trigger | 130.00% | |||||||||
Note price less than 98 percent of stock price times conversion rate [Member] | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Debt Instrument, Convertible, Threshold Trading Days | day | 5 | |||||||||
Debt Instrument, Convertible, Threshold Consecutive Trading Days | day | 5 | |||||||||
Debt Instrument, Convertible, Threshold Percentage of Stock Price Trigger | 98.00% | |||||||||
Privately Negotiated Transactions [Member] | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Proceeds from Convertible Debt | $ 49,900,000 | |||||||||
Stock Repurchased and Retired During Period, Shares | shares | 11.1 | |||||||||
TVN [Member] | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Proceeds from Convertible Debt | $ 74,200,000 | |||||||||
Income Taxes Receivable | $ 26,500,000 | $ 26,500,000 | ||||||||
Loans Backed By French Research And Development Tax Credit Receivables [Member] | TVN [Member] | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Debt Instrument, Interest Rate, Stated Percentage | 0.60% | 0.60% | ||||||||
Financing from French government agencies related to various government incentive programs (1) | [1] | $ 17,300,000 | $ 17,300,000 | |||||||
Adjusted EURIBOR Rate, Term | 1 month | |||||||||
Debt Instrument, Basis Spread on Variable Rate | 1.30% | |||||||||
Loans From French Government For R&D Innovation Projects [Member] | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Financing from French government agencies related to various government incentive programs (1) | [1] | $ 2,900,000 | 2,900,000 | |||||||
Revolving Credit Facility [Member] | Silicon Valley Bank [Member] | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Line of Credit Facility, Current Borrowing Capacity | $ 15,000,000 | $ 15,000,000 | ||||||||
Outstanding Borrowing Limit Based on Eligible Receivables, Percentage | 85.00% | 85.00% | ||||||||
Borrowing Base Limit Prior to November 1, 2017 | $ 7,500,000 | $ 7,500,000 | ||||||||
Line of Credit Facility, Fair Value of Amount Outstanding | 0 | 0 | ||||||||
Minimum Net Worth Required for Compliance | $ 20,000,000 | $ 20,000,000 | ||||||||
Covenant Ratio of Short Term Asset to Short Term Liabilities | 110.00% | 110.00% | ||||||||
Minimum Liquidity Amount on or Prior to October 31, 2017 | $ 15,000,000 | $ 15,000,000 | ||||||||
Minimum Liquidity Amount on and after November 1, 2017 | 10,000,000 | 10,000,000 | ||||||||
Other Current Liabilities [Member] | TVN [Member] | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Term loans (2) | $ 400,000 | $ 400,000 | $ 400,000 | |||||||
London Interbank Offered Rate (LIBOR) [Member] | Revolving Credit Facility [Member] | Silicon Valley Bank [Member] | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Debt Instrument, Basis Spread on Variable Rate | 2.25% | |||||||||
Comply with Liquidity Requirement [Member] | Prime Rate [Member] | Revolving Credit Facility [Member] | Silicon Valley Bank [Member] | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Debt Instrument, Basis Spread on Variable Rate | 0.00% | |||||||||
Not Comply with Liquidity Requirement [Member] | Prime Rate [Member] | Revolving Credit Facility [Member] | Silicon Valley Bank [Member] | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Debt Instrument, Basis Spread on Variable Rate | 0.25% | |||||||||
|
Convertible Notes, Other Debts And Capital Leases - Convertible Note Roll Forward (Details) - USD ($) $ in Thousands |
3 Months Ended | 12 Months Ended | |
---|---|---|---|
Sep. 29, 2017 |
Dec. 31, 2016 |
Dec. 31, 2015 |
|
Debt Instrument [Line Items] | |||
Principal amount | $ 128,250 | $ 128,250 | $ 128,250 |
Less: Debt discount, net of amortization | (18,680) | (22,302) | |
Less: Debt issuance costs, net of amortization | (2,252) | (2,689) | (3,200) |
Carrying amount | $ 107,318 | $ 103,259 | |
Remaining amortization period (years) | 3 years 2 months 12 days | 3 years 10 months 28 days | |
Effective interest rate on liability component | 9.94% | 9.94% | |
Value of conversion option | $ 26,925 | $ 26,925 | 26,925 |
Less: Equity issuance costs | (863) | (863) | $ (863) |
Carrying amount | $ 26,062 | $ 26,062 |
Convertible Notes, Other Debts And Capital Leases - Interest (Details) - USD ($) $ in Thousands |
3 Months Ended | 9 Months Ended | ||
---|---|---|---|---|
Sep. 29, 2017 |
Sep. 30, 2016 |
Sep. 29, 2017 |
Sep. 30, 2016 |
|
Debt Disclosure [Abstract] | ||||
Contractual interest expense | $ 1,283 | $ 1,283 | $ 3,848 | $ 3,848 |
Amortization of debt discount | 1,235 | 1,117 | 3,623 | 3,274 |
Amortization of debt issuance costs | 149 | 135 | 437 | 395 |
Total interest expense recognized | $ 2,667 | $ 2,535 | $ 7,908 | $ 7,517 |
Convertible Notes , Other Debts And Capital Leases - Other Debt and Capital Lease Obligations (Details) - USD ($) $ in Thousands |
Sep. 29, 2017 |
Dec. 31, 2016 |
|||||
---|---|---|---|---|---|---|---|
Debt Instrument [Line Items] | |||||||
Financing from French government agencies related to various government incentive programs (1) | [1] | $ 20,205 | $ 17,930 | ||||
Term loans (2) | [2] | 1,334 | 1,400 | ||||
Obligations under capital leases | 1,334 | 1,860 | |||||
Total debt obligations | 22,873 | 21,190 | |||||
Less: current portion | (7,434) | (7,275) | |||||
Long-term portion | $ 15,439 | $ 13,915 | |||||
|
Convertible Notes, Other Debts And Capital Leases - Debt Maturities (Details) $ in Thousands |
Sep. 29, 2017
USD ($)
|
---|---|
Debt Disclosure [Abstract] | |
Capital Leases, Future Minimum Payments, Remainder of Fiscal Year | $ 305 |
Long-term Debt, Maturities, Repayments of Principal, Remainder of Fiscal Year | 616 |
Capital Leases, Future Minimum Payments Due in Two Years | 864 |
Long-term Debt, Maturities, Repayments of Principal in Year Two | 6,058 |
Capital Leases, Future Minimum Payments Due in Three Years | 93 |
Long-term Debt, Maturities, Repayments of Principal in Year Three | 6,995 |
Capital Leases, Future Minimum Payments Due in Four Years | 50 |
Long-term Debt, Maturities, Repayments of Principal in Year Four | 6,800 |
Capital Leases, Future Minimum Payments Due in Five Years | 22 |
Long-term Debt, Maturities, Repayments of Principal in Year Five | 505 |
Capital Leases, Future Minimum Payments Due Thereafter | 0 |
Long-term Debt, Maturities, Repayments of Principal after Year Five | 565 |
Capital Leases, Future Minimum Payments Due | 1,334 |
Long-term Debt | $ 21,539 |
Employee Benefit Plans and Stock-based Compensation - Summary of Company's Stock Option and Restricted Stock Unit Activity (Detail) shares in Thousands |
3 Months Ended | 9 Months Ended | |||
---|---|---|---|---|---|
Sep. 29, 2017
$ / shares
shares
|
Sep. 29, 2017
$ / shares
shares
|
||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Shares Available for Grant, Beginning balance | 3,912 | ||||
Shares Available for Grant, Authorized | 7,400 | ||||
Shares Available for Grant, Granted | [1] | (4,446) | |||
Shares Available for Grant, Forfeited or cancelled | [1] | 2,490 | |||
Shares Available for Grant, Ending balance | 9,356 | 9,356 | |||
Below FMV Grants Decrease in Plan Reserve Shares Ratio | 1.5 | ||||
Below FMV Grants Forfeiture Increase in Plan Reserve Shares Ratio | 1.5 | ||||
Restricted Stock Units Outstanding [Member] | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Number of Units, Beginning balance | 3,864 | ||||
Shares Available for Grant, Authorized | 0 | ||||
Number of Units, Granted | [1] | 2,943 | |||
Number of Units, exercised | 0 | ||||
Number of Units, Shares released | (2,244) | ||||
Number of Units, Forfeited or cancelled | [1] | (1,182) | |||
Number of Units, Ending balance | 3,381 | 3,381 | |||
Weighted Average Grant Date Fair Value, Beginning balance | $ / shares | $ 4.26 | ||||
Weighted Average Grant Date Fair Value, Authorized | $ / shares | 0 | ||||
Estimated weighted average fair value per share at purchase date | $ / shares | [1] | 5.40 | |||
Weighted Average Grant Date Fair Value, Exercised | $ / shares | 0 | ||||
Weighted Average Grant Date Fair Value, Shares released | $ / shares | 4.12 | ||||
Weighted Average Grant Date Fair Value, Forfeited or cancelled | $ / shares | [1] | 5.05 | |||
Weighted Average Grant Date Fair Value, Ending balance | $ / shares | $ 5.04 | $ 5.04 | |||
Stock Options Outstanding [Member] | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Shares Available for Grant, Authorized | 0 | ||||
Number of Shares, Beginning balance | 5,019 | ||||
Number of Shares, Granted | [1] | 0 | 30 | ||
Number of Shares, Options exercised | (97) | ||||
Number of Shares, Forfeited or cancelled | [1] | (717) | |||
Number of Shares, Ending balance | 4,235 | 4,235 | |||
Weighted Average Exercise Price, Beginning balance | $ / shares | $ 6.01 | ||||
Weighted Average Exercise Price, Authorized | $ / shares | 0 | ||||
Weighted Average Exercise Price, Granted | $ / shares | [1] | 5.10 | |||
Weighted Average Exercise Price, Options exercised | $ / shares | 3.03 | ||||
Weighted Average Exercise Price, Forfeited or cancelled | $ / shares | [1] | 5.95 | |||
Weighted Average Exercise Price, Ending balance | $ / shares | $ 6.09 | $ 6.09 | |||
|
Employee Benefit Plans and Stock-based Compensation - Additional Information (Detail) - USD ($) |
1 Months Ended | 2 Months Ended | 3 Months Ended | 9 Months Ended | |||||||
---|---|---|---|---|---|---|---|---|---|---|---|
Jan. 01, 2017 |
Mar. 31, 2017 |
Aug. 31, 2016 |
Apr. 30, 2017 |
Sep. 29, 2017 |
Sep. 30, 2016 |
Sep. 29, 2017 |
Sep. 30, 2016 |
Dec. 31, 2016 |
|||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||||
Increased Number of Common Shares Reserved for Issuance | 7,400,000 | ||||||||||
Intrinsic value of options exercised | $ 6,000 | $ 100,000 | $ 300,000 | $ 100,000 | |||||||
Defined Benefit Plan, Benefit Obligation | 5,100,000 | 5,100,000 | $ 4,300,000 | ||||||||
Liability, Defined Benefit Pension Plan, Current | 55,000 | 55,000 | |||||||||
Liability, Defined Benefit Pension Plan, Noncurrent | 4,956,000 | $ 4,956,000 | |||||||||
Discretionary contributions of plan | 25.00% | ||||||||||
Percent of employees' gross pay eligible for matching | 4.00% | ||||||||||
Maximum contribution amount per participant | $ 1,000 | ||||||||||
Contributions in period | 326,000 | 316,000 | |||||||||
Employee Service Share-based Compensation, Nonvested Awards, Compensation Cost Not yet Recognized | 13,500,000 | $ 13,500,000 | |||||||||
Employee Service Share-based Compensation, Nonvested Awards, Compensation Cost Not yet Recognized, Period for Recognition | 1 year 7 months 17 days | ||||||||||
Total stock-based compensation | 3,720,000 | 2,680,000 | $ 11,107,000 | 8,542,000 | |||||||
Employee Service Share-based Compensation, Tax Benefit from Exercise of Stock Options | 0 | $ 0 | $ 0 | $ 0 | |||||||
Stock Options [Member] | |||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||||
Volatility | 39.00% | 43.00% | 36.00% | ||||||||
Risk-free interest rate | 1.00% | 1.70% | 1.40% | ||||||||
Expected dividends | 0.00% | 0.00% | 0.00% | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Grants in Period, Weighted Average Grant Date Fair Value | $ 1.00 | $ 1.85 | $ 0.97 | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Vested in Period, Fair Value | $ 300,000 | $ 400,000 | $ 1,400,000 | $ 1,800,000 | |||||||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Grants in Period, Net of Forfeitures | 0 | ||||||||||
Performance-based Restricted Stock Units [Member] | |||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||||
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Grants in Period | 898,533 | 582,806 | |||||||||
Market-based awards [Member] | |||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||||
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Grants in Period | 344,500 | ||||||||||
Share-based Compensation Arrangement by Share-based Payment Award, Award Vesting Period | 3 years | ||||||||||
Employee Service Share-based Compensation, Nonvested Awards, Compensation Cost Not yet Recognized | $ 500,000 | $ 500,000 | |||||||||
Employee Service Share-based Compensation, Nonvested Awards, Compensation Cost Not yet Recognized, Period for Recognition | 6 months 21 days | ||||||||||
Volatility | 46.70% | ||||||||||
Risk-free interest rate | 1.57% | ||||||||||
Expected dividends | 0.00% | ||||||||||
Total stock-based compensation | 400,000 | $ 800,000 | |||||||||
RSUs and PRSUs [Member] | |||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||||
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Vested in Period, Fair Value | $ 1,900,000 | $ 1,600,000 | $ 9,200,000 | $ 8,600,000 | |||||||
Employee Stock Purchase Plan | |||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||||
Common Stock, Capital Shares Reserved for Future Issuance | 1,114,796 | 1,114,796 | |||||||||
Discount Percentage On Purchase Of Stock | 15.00% | ||||||||||
Percentage of fair market value of Common Stock to purchase shares | 85.00% | ||||||||||
Value Of Stock Purchase Right Percentage Of Put Option | 15.00% | ||||||||||
Equity Option [Member] | |||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||||
Increased Number of Common Shares Reserved for Issuance | 0 | ||||||||||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Grants in Period, Net of Forfeitures | [1] | 0 | 30,000 | ||||||||
Minimum [Member] | Performance-based Restricted Stock Units [Member] | |||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||||
Share-based Compensation Arrangement by Share-based Payment Award, Award Vesting Period | 3 months | ||||||||||
Maximum [Member] | Performance-based Restricted Stock Units [Member] | |||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||||
Share-based Compensation Arrangement by Share-based Payment Award, Award Vesting Period | 6 months | ||||||||||
TVN [Member] | |||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||||
Payment for Pension and Other Postretirement Benefits | $ 0 | ||||||||||
Stock Plan 1995 [Member] | |||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||||
Increased Number of Common Shares Reserved for Issuance | 7,000,000 | ||||||||||
Stock Plan 1995 [Member] | Employee Stock Purchase Plan | |||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||||
Increased Number of Common Shares Reserved for Issuance | 1,500,000 | ||||||||||
Director Option Plans 2002 [Member] | |||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||||
Increased Number of Common Shares Reserved for Issuance | 400,000 | ||||||||||
Accounting Standards Update 2016-09 [Member] | |||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||||
Stock Granted, Value, Share-based Compensation, Forfeited | $ 69,000 | ||||||||||
|
Employee Benefit Plans and Stock-based Compensation - Summary of Stock Options Outstanding (Detail) - Stock Options Outstanding [Member] $ / shares in Units, shares in Thousands, $ in Thousands |
9 Months Ended |
---|---|
Sep. 29, 2017
USD ($)
$ / shares
shares
| |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Number of Shares, Vested and expected to vest | shares | 4,176 |
Weighted Average Exercise Price, Vested and expected to vest | $ / shares | $ 6.10 |
Weighted Average Remaining Contractual Term (Years), Vested and expected to vest | 3 years 1 month 3 days |
Aggregate Intrinsic Value, Vested and expected to vest | $ | $ 84 |
Number of Shares, Exercisable | shares | 3,505 |
Weighted Average Exercise Price, Exercisable | $ / shares | $ 6.31 |
Weighted Average Remaining Contractual Term (Years), Exercisable | 2 years 8 months 12 days |
Aggregate Intrinsic Value, Exercisable | $ | $ 84 |
Employee Benefit Plans and Stock-based Compensation - Summary of Restricted Stock Units Outstanding (Detail) - Restricted Stock Units Outstanding [Member] shares in Thousands, $ in Thousands |
9 Months Ended |
---|---|
Sep. 29, 2017
USD ($)
shares
| |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Number of Shares Underlying Restricted Stock Units | shares | 2,759 |
Weighted Average Remaining Vesting Period (Years) | 9 months 3 days |
Aggregate Fair Value | $ | $ 8,415 |
Employee Benefit Plans and Stock-based Compensation - Summary of Projected Benefit Obligation (Details) - USD ($) $ in Thousands |
3 Months Ended | 9 Months Ended | ||
---|---|---|---|---|
Sep. 29, 2017 |
Sep. 30, 2016 |
Sep. 29, 2017 |
Sep. 30, 2016 |
|
Employee Benefits and Share-based Compensation, Noncash [Abstract] | ||||
Service cost | $ 55 | $ 70 | $ 165 | $ 164 |
Interest cost | 16 | 29 | 48 | 68 |
Recognized net actuarial loss | 1 | 0 | 4 | 0 |
Net periodic benefit cost included in operating loss | $ 72 | $ 99 | $ 217 | $ 232 |
Employee Benefit Plans and Stock-based compensation - Stock-based Compensation in Opex (Details) - USD ($) $ in Thousands |
3 Months Ended | 9 Months Ended | ||
---|---|---|---|---|
Sep. 29, 2017 |
Sep. 30, 2016 |
Sep. 29, 2017 |
Sep. 30, 2016 |
|
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | ||||
Total stock-based compensation | $ 3,720 | $ 2,680 | $ 11,107 | $ 8,542 |
Cost of Sales [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | ||||
Total stock-based compensation | 478 | 360 | 1,623 | 1,011 |
Research and Development Expense [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | ||||
Total stock-based compensation | 1,183 | 771 | 3,496 | 2,581 |
Selling, General and Administrative Expenses [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | ||||
Total stock-based compensation | 2,059 | 1,549 | 5,988 | 4,950 |
Operating Expense [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | ||||
Total stock-based compensation | $ 3,242 | $ 2,320 | $ 9,484 | $ 7,531 |
Employee Benefit Plans and Stock-based Compensation - Valuation Assumptions for Stock Options (Details) - Stock Options [Member] |
3 Months Ended | 9 Months Ended | |
---|---|---|---|
Sep. 30, 2016 |
Sep. 29, 2017 |
Sep. 30, 2016 |
|
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Expected term (years) | 4 years 3 months 18 days | 4 years 7 months 6 days | 4 years 3 months 18 days |
Volatility | 39.00% | 43.00% | 36.00% |
Risk-free interest rate | 1.00% | 1.70% | 1.40% |
Expected dividends | 0.00% | 0.00% | 0.00% |
Employee Benefit Plans and Stock-based Compensation - Summary of Stock Awards Valuation Assumptions (Details) - Employee Stock Purchase Plan - $ / shares |
6 Months Ended | |||
---|---|---|---|---|
Dec. 31, 2017 |
Jul. 03, 2017 |
Dec. 31, 2016 |
Jun. 30, 2016 |
|
Purchase Period July 3, 2017 [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Expected term (years) | 5 months 27 days | |||
Volatility | 41.00% | |||
Risk-free interest rate | 1.00% | |||
Expected dividends | 0.00% | |||
Estimated weighted average fair value per share at purchase date | $ 1.40 | |||
Purchase Period December 31, 2016 [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Expected term (years) | 6 months | |||
Volatility | 70.00% | |||
Risk-free interest rate | 0.60% | |||
Expected dividends | 0.00% | |||
Estimated weighted average fair value per share at purchase date | $ 1.04 | |||
Purchase Period June 30, 2016 [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Expected term (years) | 6 months 1 day | |||
Volatility | 54.00% | |||
Risk-free interest rate | 0.40% | |||
Expected dividends | 0.00% | |||
Estimated weighted average fair value per share at purchase date | $ 1.19 | |||
Scenario, Forecast [Member] | Purchase Period December 31, 2017 [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Expected term (years) | 6 months 1 day | |||
Volatility | 43.00% | |||
Risk-free interest rate | 1.20% | |||
Expected dividends | 0.00% | |||
Estimated weighted average fair value per share at purchase date | $ 1.42 |
Income Taxes (Details) - USD ($) $ in Thousands |
3 Months Ended | 9 Months Ended | ||
---|---|---|---|---|
Sep. 29, 2017 |
Sep. 30, 2016 |
Sep. 29, 2017 |
Sep. 30, 2016 |
|
Income Tax Disclosure [Abstract] | ||||
Loss before income taxes | $ (17,498) | $ (16,254) | $ (72,678) | $ (61,353) |
(Benefit from) provision for income taxes | $ (1,915) | $ (242) | $ (1,568) | $ 518 |
Effective income tax rate | 10.90% | 1.50% | 2.20% | (0.80%) |
Income Taxes - Additional Information (Detail) - USD ($) |
3 Months Ended | 9 Months Ended | ||||
---|---|---|---|---|---|---|
Jan. 01, 2017 |
Sep. 29, 2017 |
Mar. 31, 2017 |
Sep. 30, 2016 |
Sep. 29, 2017 |
Sep. 30, 2016 |
|
Income Tax Contingency [Line Items] | ||||||
Unrecognized Tax Benefits | $ 17,600,000 | $ 17,600,000 | ||||
Effective income tax rate | 10.90% | 1.50% | 2.20% | (0.80%) | ||
Federal statutory income tax rate | 35.00% | 35.00% | ||||
One-time tax benefit from merger, Amount | $ 1,200,000 | |||||
Effective Income Tax Rate Reconciliation, Tax Contingency, Amount | $ 2,400,000 | |||||
Unrecognized tax benefits that would impact the provision for income taxes | 700,000 | $ 700,000 | ||||
Interest and possible penalties related to uncertain tax positions | 400,000 | 400,000 | ||||
Decrease in Unrecognized Tax Benefits is Reasonably Possible | $ 500,000 | $ 500,000 | ||||
SWITZERLAND | ||||||
Income Tax Contingency [Line Items] | ||||||
Income Tax Holiday, Description | The Company’s operations in Switzerland are subject to a reduced tax rate under the Switzerland tax holiday which requires various thresholds of investment and employment in Switzerland. The Company has met these various thresholds and the Switzerland tax holiday is effective through the end of 2018. | |||||
Accounting Standards Update 2016-09 [Member] | ||||||
Income Tax Contingency [Line Items] | ||||||
Cumulative Effect on Retained Earnings, Net of Tax | $ 69,000 | |||||
Accounting Standards Update 2016-09 [Member] | Deferred Tax Assets Gross | ||||||
Income Tax Contingency [Line Items] | ||||||
New Accounting Pronouncement or Change in Accounting Principle, Effect of Adoption, Quantification | 4,600,000 | |||||
Accounting Standards Update 2016-09 [Member] | Valuation Allowance of Deferred Tax Assets | ||||||
Income Tax Contingency [Line Items] | ||||||
New Accounting Pronouncement or Change in Accounting Principle, Effect of Adoption, Quantification | 4,600,000 | |||||
Accounting Standards Update 2016-09 [Member] | Net Deferred Tax Asset | ||||||
Income Tax Contingency [Line Items] | ||||||
New Accounting Pronouncement or Change in Accounting Principle, Effect of Adoption, Quantification | 0 | |||||
Accounting Standards Update 2016-16 [Member] | ||||||
Income Tax Contingency [Line Items] | ||||||
Cumulative Effect on Retained Earnings, Net of Tax | $ 1,400,000 | |||||
Deferred Tax Assets, Net | 1,100,000 | |||||
Deferred Tax Assets, Valuation Allowance | 2,100,000 | |||||
Deferred Tax Assets, Tax Deferred Expense | $ 300,000 |
Income (Loss) Per Share - Numerators and Denominators of Basic and Diluted Net Income (Loss) Per Share Computations (Detail) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands |
3 Months Ended | 9 Months Ended | ||
---|---|---|---|---|
Sep. 29, 2017 |
Sep. 30, 2016 |
Sep. 29, 2017 |
Sep. 30, 2016 |
|
Numerator: | ||||
Net loss | $ (15,583) | $ (16,012) | $ (71,110) | $ (61,871) |
Denominator: | ||||
Basic and diluted | 81,445 | 78,092 | 80,618 | 77,475 |
Net loss per share: | ||||
Basic and diluted | $ (0.19) | $ (0.21) | $ (0.88) | $ (0.80) |
Income (Loss) Per Share - Anti-dilutive Securities (Detail) - $ / shares |
3 Months Ended | 9 Months Ended | |||||
---|---|---|---|---|---|---|---|
Sep. 29, 2017 |
Sep. 30, 2016 |
Sep. 29, 2017 |
Sep. 30, 2016 |
Dec. 31, 2015 |
|||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||||||
Potentially dilutive equity awards outstanding | 9,490,000 | 9,248,000 | 9,147,000 | 8,317,000 | |||
Potential Common Shares Upon Notes Conversion If Only Settled In Shares | 22,304,348 | 22,304,348 | |||||
Debt Instrument, Convertible, Conversion Price | $ 5.75 | $ 5.75 | $ 5.75 | ||||
Stock Options [Member] | |||||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||||||
Potentially dilutive equity awards outstanding | 4,377,000 | 5,193,000 | 4,628,000 | 5,389,000 | |||
Restricted Stock Units (RSUs) | |||||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||||||
Potentially dilutive equity awards outstanding | 3,213,000 | 2,800,000 | 3,107,000 | 2,273,000 | |||
Employee Stock Purchase Plan | |||||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||||||
Potentially dilutive equity awards outstanding | 1,118,000 | 1,212,000 | 630,000 | 641,000 | |||
Warrant [Member] | |||||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||||||
Potentially dilutive equity awards outstanding | [1] | 782,000 | 43,000 | 782,000 | 14,000 | ||
|
Warrants (Details) - USD ($) $ / shares in Units, $ in Millions |
9 Months Ended | |
---|---|---|
Sep. 29, 2017 |
Sep. 26, 2016 |
|
Class of Warrant or Right [Line Items] | ||
Class of Warrant or Right, Number of Securities Called by Warrants or Rights | 7,816,162 | |
Class of Warrant or Right, Exercise Price of Warrants or Rights | $ 4.76 | |
Comcast Product Supply Agreement [Member] | ||
Class of Warrant or Right [Line Items] | ||
Class of Warrant or Right, Outstanding | 781,617 | |
Warrants and Rights Outstanding | $ 1.6 | $ 1.6 |
Fair Value Assumptions, Expected Term | 7 years | |
Fair Value Assumptions, Weighted Average Volatility Rate | 42.00% | |
Fair Value Assumptions, Risk Free Interest Rate | 1.40% | |
Fair Value Assumptions, Expected Dividend Rate | 0.00% | |
Comcast Milestones Achievement [Member] | ||
Class of Warrant or Right [Line Items] | ||
Class of Warrant or Right, Unissued | 1,954,042 | |
Comcast Exceeding Specified Cumulative Purchase Volume [Member] | ||
Class of Warrant or Right [Line Items] | ||
Class of Warrant or Right, Unissued | 1,172,425 | |
Comcast Specified Tranches [Member] | ||
Class of Warrant or Right [Line Items] | ||
Class of Warrant or Right, Unissued | 3,908,081 | |
Sales Revenue, Goods, Net [Member] | Comcast Product Supply Agreement [Member] | ||
Class of Warrant or Right [Line Items] | ||
Warrants and Rights Outstanding | $ 0.5 | |
Prepaid Expenses and Other Current Assets [Member] | ||
Class of Warrant or Right [Line Items] | ||
Prepaid Warrants Incentive | $ 1.1 |
Stockholders' Equity - Components of Accumulated Other Comprehensive Loss (Detail) - USD ($) $ in Thousands |
3 Months Ended | 9 Months Ended | |||
---|---|---|---|---|---|
Sep. 29, 2017 |
Sep. 30, 2016 |
Sep. 29, 2017 |
Sep. 30, 2016 |
Dec. 31, 2016 |
|
Equity [Abstract] | |||||
Foreign currency translation adjustments | $ (120) | $ (120) | $ (7,267) | ||
Unrealized gain on investments | (331) | (331) | 276 | ||
Actuarial Loss | (279) | (279) | (279) | ||
Accumulated Other Comprehensive Loss | (730) | (730) | $ (7,270) | ||
Other Comprehensive Income (Loss), Foreign Currency Transaction and Translation Adjustment, before Tax | 2,265 | $ 523 | 7,147 | $ (154) | |
Other Comprehensive Income (Loss), Available-for-sale Securities Adjustment, before Tax | $ 8 | $ (1,208) | (605) | $ (1,178) | |
Other Comprehensive Income (Loss), before Reclassifications, before Tax | 6,542 | ||||
Other Comprehensive Income (Loss), Foreign Currency Translation Gain (Loss) Arising During Period, Tax | 0 | ||||
Other Comprehensive Income (Loss), Available-for-sale Securities, Tax | (2) | ||||
Other Comprehensive Income (Loss), Tax, Portion Attributable to Parent | $ (2) |
Stockholders' Equity - Reclassification from AOCI to Statement of Operations (Details) - USD ($) $ in Thousands |
3 Months Ended | 9 Months Ended | ||
---|---|---|---|---|
Sep. 29, 2017 |
Sep. 30, 2016 |
Sep. 29, 2017 |
Sep. 30, 2016 |
|
Reclassification Adjustment out of Accumulated Other Comprehensive Income on Derivatives [Line Items] | ||||
Derivative Instruments, Loss Reclassified from Accumulated OCI into Income, Effective Portion | $ 0 | $ 0 | $ (53) | |
Derivative Instruments, Gain Reclassified from Accumulated OCI into Income, Effective Portion | $ 47 | |||
Cost of Sales [Member] | ||||
Reclassification Adjustment out of Accumulated Other Comprehensive Income on Derivatives [Line Items] | ||||
Derivative Instruments, Loss Reclassified from Accumulated OCI into Income, Effective Portion | 0 | 0 | (7) | |
Derivative Instruments, Gain Reclassified from Accumulated OCI into Income, Effective Portion | 6 | |||
Operating Expense [Member] | ||||
Reclassification Adjustment out of Accumulated Other Comprehensive Income on Derivatives [Line Items] | ||||
Derivative Instruments, Loss Reclassified from Accumulated OCI into Income, Effective Portion | $ 0 | $ 0 | $ (46) | |
Derivative Instruments, Gain Reclassified from Accumulated OCI into Income, Effective Portion | $ 41 |
Stockholders' Equity - Additional Information (Detail) - USD ($) |
Sep. 29, 2017 |
Dec. 31, 2016 |
---|---|---|
Stockholders' Equity Note [Abstract] | ||
Other Comprehensive Income (Loss), Reclassification Adjustment from AOCI on Derivatives, Net of Tax | $ 0 | |
Cash Flow Hedge Contracts Outstanding | $ 0 | $ 0 |
Segment Information (Details) $ in Thousands |
3 Months Ended | 9 Months Ended | |||
---|---|---|---|---|---|
Sep. 29, 2017
USD ($)
|
Sep. 30, 2016
USD ($)
|
Sep. 29, 2017
USD ($)
segment
|
Sep. 30, 2016
USD ($)
|
Feb. 29, 2016 |
|
Segment Reporting Information [Line Items] | |||||
Revenue, Net | $ 92,014 | $ 101,406 | $ 257,272 | $ 292,809 | |
Income (loss) from operations | (14,206) | (11,933) | (62,786) | (50,807) | |
Operating Expenses | (61,231) | (63,296) | (184,034) | (193,864) | |
Stock-based compensation | (3,720) | (2,680) | (11,107) | (8,542) | |
Amortization of intangibles | (2,088) | (4,389) | (6,232) | (12,711) | |
Nonoperating Income (Expense) | (3,292) | (4,321) | (9,892) | (10,546) | |
Loss before income taxes | (17,498) | (16,254) | $ (72,678) | (61,353) | |
Number of Reportable Segments | segment | 2 | ||||
Video [Member] | |||||
Segment Reporting Information [Line Items] | |||||
Revenue, Net | 84,155 | 91,353 | $ 231,876 | 246,949 | |
Cable Edge [Member] | |||||
Segment Reporting Information [Line Items] | |||||
Revenue, Net | 7,859 | 10,053 | 25,396 | 45,860 | |
Operating Segments [Member] | |||||
Segment Reporting Information [Line Items] | |||||
Income (loss) from operations | 1,652 | 119 | (26,622) | (9,061) | |
Operating Segments [Member] | Video [Member] | |||||
Segment Reporting Information [Line Items] | |||||
Income (loss) from operations | 7,009 | 4,886 | (7,774) | (1,943) | |
Operating Segments [Member] | Cable Edge [Member] | |||||
Segment Reporting Information [Line Items] | |||||
Income (loss) from operations | (5,357) | (4,767) | (18,848) | (7,118) | |
Corporate, Non-Segment [Member] | |||||
Segment Reporting Information [Line Items] | |||||
Operating Expenses | $ (10,050) | $ (4,983) | $ (18,825) | $ (20,493) | |
TVN [Member] | |||||
Segment Reporting Information [Line Items] | |||||
Business Acquisition, Percentage of Voting Interests Acquired | 100.00% |
Commitments and Contingencies - Future Minimum Lease Payments Under Non-cancelable Operating Leases (Detail) $ in Thousands |
Sep. 29, 2017
USD ($)
|
---|---|
Commitments and Contingencies Disclosure [Abstract] | |
2017 (remaining three months) | $ 3,359 |
2018 | 13,053 |
2019 | 11,607 |
2020 | 8,218 |
2021 | 2,738 |
Thereafter | 11,169 |
Total | $ 50,144 |
Commitments and Contingencies - Summary of Warranty Accrual Included in Accrued Liabilities (Detail) - USD ($) $ in Thousands |
3 Months Ended | 9 Months Ended | ||
---|---|---|---|---|
Sep. 29, 2017 |
Sep. 30, 2016 |
Sep. 29, 2017 |
Sep. 30, 2016 |
|
Commitments and Contingencies Disclosure [Abstract] | ||||
Balance at beginning of period | $ 4,142 | $ 5,095 | $ 4,862 | $ 3,913 |
Balance assumed from TVN acquisition | 0 | 0 | 0 | 1,012 |
Accrual for current period warranties | 1,354 | 1,552 | 3,849 | 4,527 |
Changes in liability related to pre-existing warranties | 0 | (99) | 0 | (173) |
Warranty costs incurred | (1,155) | (1,469) | (4,370) | (4,200) |
Balance at end of period | $ 4,341 | $ 5,079 | $ 4,341 | $ 5,079 |
Commitments and Contingencies - Additional Information (Detail) |
1 Months Ended | 3 Months Ended | |||
---|---|---|---|---|---|
Oct. 24, 2017
USD ($)
|
Oct. 30, 2011
Patents
|
Sep. 29, 2017
USD ($)
|
|||
Other Commitments [Line Items] | |||||
Non-cancelable purchase commitments | $ 27,800,000 | ||||
Maximum amount of potential future payments under the company's financial guarantees | 800,000 | ||||
Estimated Litigation Liability, Current | [1] | 2,500,000 | |||
Guarantee Obligations [Member] | |||||
Other Commitments [Line Items] | |||||
Guarantees related to rent obligations | 1,900,000 | ||||
Indemnification [Member] | |||||
Other Commitments [Line Items] | |||||
Accrual for indemnification provisions | 0 | ||||
Israel [Member] | Guarantee Obligations [Member] | |||||
Other Commitments [Line Items] | |||||
Guarantees related to rent obligations | 300,000 | ||||
TVN [Member] | Guarantee Obligations [Member] | |||||
Other Commitments [Line Items] | |||||
Guarantees related to rent obligations | 1,300,000 | ||||
Avid [Member] | |||||
Other Commitments [Line Items] | |||||
Loss Contingency, Patents Allegedly Infringed, Number | Patents | 2 | ||||
Estimated Litigation Liability | 6,000,000 | ||||
Estimated Litigation Liability, Current | 2,500,000 | ||||
Estimated Litigation Liability, Noncurrent | 3,500,000 | ||||
Avid [Member] | Subsequent Event [Member] | |||||
Other Commitments [Line Items] | |||||
Payments for Legal Settlements | $ 2,500,000 | ||||
Avid [Member] | Selling, General and Administrative Expenses [Member] | |||||
Other Commitments [Line Items] | |||||
Litigation Settlement, Expense | 6,000,000 | ||||
Settled Litigation Payment Second Quarter of 2019 [Member] | Avid [Member] | |||||
Other Commitments [Line Items] | |||||
Estimated Litigation Liability, Noncurrent | 1,500,000 | ||||
Settled Litigation Payment Third Quarter of 2020 [Member] | Avid [Member] | |||||
Other Commitments [Line Items] | |||||
Estimated Litigation Liability, Noncurrent | $ 2,000,000 | ||||
|
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